The $100 Billion Nvidia OpenAI Deal Is Officially on Ice: What Investors Missed

The headlines in September 2025 were impossible to ignore. A massive, $100 billion collaboration between the two undisputed kings of artificial intelligence promised to reshape the hardware landscape. It was billed as the "infrastructure backbone of the future," a plan to deploy 10 gigawatts of compute power that would cement the dominance of both parties.

Fast forward a few months, and the narrative has shifted dramatically.

During the recent UBS Global Technology and AI Conference, Nvidia CFO Colette Kress quietly dismantled the assumption that this partnership was a done deal. Her admission—that there is no definitive agreement currently in place—has turned the spotlight from technological potential to financial scrutiny. The massive Nvidia OpenAI deal that fueled market optimism is now sitting in regulatory and contractual purgatory, officially "on ice."

This situation serves as a stark case study for anyone navigating the volatile world of AI investing. It highlights the chasm between a press release "Letter of Intent" and a legally binding contract.

Validating the Nvidia OpenAI Deal: An Investor’s Guide to 10-Q Filings

Before dissecting the corporate politics, we need to address the practical "user experience" of following this story. For retail investors and tech analysts, the gap between what was announced and what was signed has been a source of confusion and loss.

Experienced observers on platforms like Reddit pointed out a recurring pattern: companies announce "strategic partnerships" to drive momentum, while the actual legal commitments remain non-existent.

How to Verify Claims in Real-Time

The most effective way to gauge the reality of the Nvidia OpenAI deal wasn't reading the initial celebratory articles; it was reading the fine print. Specifically, the "Risk Factors" section of Nvidia’s 10-Q filing.

While the press release utilized bold terms like "deployment" and "commitment," the financial filings told a different story. In the 10-Q, the company explicitly stated there is "no assurance that any investment will be completed... if at all."

For future reference, when a mega-cap tech company announces a venture exceeding $10 billion, ignore the slide deck. Go immediately to the SEC EDGAR database. Look for the distinction between a "Letter of Intent" (LOI) and a "Definitive Agreement." An LOI is effectively a handshake—it shows ambition but carries zero legal weight regarding capital transfer. This specific due diligence step separates those who bought the rumor from those who spotted the lack of substance.

Decoding the "Letter of Intent" in the Nvidia OpenAI Deal

A critical piece of information extracted from community discussions clarifies why this isn't necessarily fraud, despite feeling misleading. The initial announcement regarding the Nvidia OpenAI deal was carefully lawyered. By framing the 10GW deployment as an "intention" or part of a "strategic partnership" rather than a finalized purchase order, executives protected themselves from securities violations.

The "on ice" status isn't a breach of contract because, technically, there never was a contract.

The Financial Reality Behind the Nvidia OpenAI Deal Delays

The current stalling of the Nvidia OpenAI deal isn't just about paperwork; it hints at deeper friction regarding how AI revenue is generated and reported.

Nvidia’s financial guidance provided the first real clue. Despite the projected size of the OpenAI collaboration—potentially involving millions of GPUs—current revenue forecasts did not factor in these numbers. Kress confirmed this disconnect at the UBS conference. If the deal were solid, it would be front and center in the forward-looking guidance. Its absence is a red flag that the timeline has slipped significantly, with the proposed late 2026 deployment now looking optimistic at best.

The "Round-Tripping" Revenue Concern

One of the most contentious aspects of this partnership involves the flow of capital. The structure of the proposed Nvidia OpenAI deal involves Nvidia investing cash into OpenAI. In turn, OpenAI uses that cash to purchase Nvidia GPUs.

OpenAI CFO Sarah Friar has acknowledged this circular dynamic. Critics and market analysts call this "round-tripping."

1. Company A (Nvidia) gives money to Company B (OpenAI) as an investment.

2. Company B uses that money to buy products from Company A.

3. Company A books that money as revenue, boosting its stock price.

While not illegal if disclosed properly, it artificially inflates the perceived organic demand for the product. If the investment from Nvidia stops, the revenue from OpenAI potentially evaporates. This circular dependency creates a fragile ecosystem where growth is funded by the vendor’s own balance sheet rather than genuine external customer profits.

Regulatory Risks Surrounding the Nvidia OpenAI Deal

This financial architecture has naturally attracted attention. Market observers are drawing uncomfortable parallels to past corporate accounting scandals where revenue quality was masked by complex partnerships.

There is a growing demand from the investment community for the SEC to scrutinize these "cloud-for-equity" or "chips-for-equity" arrangements. If the Nvidia OpenAI deal is formally investigated, it could freeze not just this specific project, but the broader mechanism Nvidia uses to prop up the startup ecosystem surrounding its hardware.

Timeline and Feasibility: The 10GW Question

Beyond the financial engineering, the physical reality of the proposed project faces significant hurdles. The initial pitch was to build a 10-gigawatt AI supercomputer network. To put that in perspective, 10GW is roughly the power consumption of several million average homes or a small country.

The Disconnect Between Announcement and Execution

The original timeline suggested the first gigawatt-scale facilities would come online by late 2026. However, given that the Nvidia OpenAI deal is currently non-binding, no ground has been broken.

Skeptics argue that even with a signed check today, the lead time for permitting, power acquisition, and cooling infrastructure for a 10GW cluster exceeds the 18-month window originally touted. The lack of a definitive agreement suggests that neither party is ready to commit the capital required to secure these long-lead items.

This delay benefits competitors. While Nvidia and OpenAI haggle over terms, Google is aggressively building out its TPU infrastructure, and other cloud providers are diversifying their chip supply to reduce reliance on Nvidia. The longer the Nvidia OpenAI deal stays on ice, the more time the rest of the market has to catch up.

Why the Deal Might Never Happen

There is a distinct possibility that this partnership, in its advertised form, simply evaporates.

Nvidia’s 10-Q filing also listed commitments to other players, including a $10 billion roadmap with Anthropic and obligations to Intel. Nvidia is hedging its bets. By keeping the OpenAI agreement non-definitive, Nvidia retains the leverage to pivot if OpenAI’s leadership structure changes again or if the "scaling laws" of LLMs hit a diminishing returns wall.

Furthermore, SoftBank is reportedly circling OpenAI with a $30 billion investment offer. If OpenAI secures funding elsewhere, their need to accept Nvidia's capital (and the attached strings regarding hardware exclusivity) diminishes. The Nvidia OpenAI deal might have been a tool for OpenAI to solicit better valuations from other investors—a classic leverage play that leaves the original "strategic partner" on the sidelines.

The admission from Colette Kress wasn't a slip of the tongue. It was a calculated reset of expectations. The 100 billion dollar figure that drove headlines is, for now, a phantom number. Until a definitive agreement is filed with the SEC, the massive fleet of GPUs promised to OpenAI exists only on paper.

FAQ: Understanding the Stalled Nvidia OpenAI Deal

Is the Nvidia OpenAI deal officially cancelled?

No, the deal is not cancelled, but it is "on ice." Nvidia CFO Colette Kress confirmed there is no definitive agreement signed, meaning the partnership is currently just a non-binding intent.

What is the "round-tripping" controversy with Nvidia and OpenAI?

Round-tripping refers to the cycle where Nvidia invests cash in OpenAI, and OpenAI uses that same cash to buy Nvidia GPUs. Critics argue this inflates Nvidia's revenue figures using their own balance sheet rather than organic sales.

Did Nvidia lie about the $100 billion partnership?

Legally, likely not. The initial announcement was framed as a "Letter of Intent" or strategic goal, not a finalized contract. Companies often announce intentions before signing binding agreements, though this can mislead retail investors who don't read SEC filings.

How can I check if a tech deal is real?

Review the company's 10-Q or 10-K filings with the SEC. Look for the "Risk Factors" section or notes on "subsequent events." If a deal is legally binding, it will usually be detailed there; if it's just a plan, it will be described with cautionary language like "no assurance."

What does the 10GW capacity mean for this deal?

10GW refers to the power consumption of the proposed AI data centers. This is a massive infrastructure project requiring gigawatts of electricity. The lack of a signed contract makes the timeline for building this infrastructure by 2026 highly improbable.

Does this affect Nvidia's stock price?

It adds volatility. Since the revenue from the Nvidia OpenAI deal was not included in current financial guidance, the immediate earnings aren't affected, but the long-term growth narrative is weakened by the uncertainty.