Jensen Huang Mocks Nvidia ‘Circular Financing’ Fears: ‘If That Is, Let’s Do More of That’

Nvidia Corp. (NASDAQ:NVDA)/a> CEO Jensen Huang mocked concerns that the chip giant is fueling its own demand by financing companies and infrastructure projects that ultimately deploy Nvidia technology.

"Is that circular? If that is, let’s do more of that," Huang said Thursday at Goldman Sachs’ Communacopia + Technology Conference.

Goldman Sachs analyst Jim Schneider pressed Huang on Nvidia’s guarantees and financial backing for AI labs and cloud providers. He also pointed to Nvidia’s $500 billion infrastructure financing platform, launched with six financial institutions including BlackRock to mobilize third-party capital.

Huang said Nvidia puts relatively little capital into those projects compared with the business they generate.

"We put in one and 100 comes back in," he said.

Huang Says He Needs a ‘Sure Thing’

Huang argued Nvidia has unusually good visibility into the projects it supports because "we brought the pipeline to them."

"I’m not taking any risks," Huang said. "I need a sure thing."

He said Nvidia can see around $100 billion of contracted customer demand behind the projects it helps finance. "It’s lined-up contracts. It’s total contracted value. It’s real stuff."

Huang also called the strategy necessary to create a global network of newer cloud providers that can serve as "distribution channels for NVIDIA’s architecture."

The network is already large. Nvidia disclosed $99 billion of equity investments as of July 26 and another $25 billion of future investment commitments.

CoreWeave Inc. (NASDAQ:CRWV)/a> is one of the more visible examples. Nvidia invested $2 billion in the cloud provider in January, deepening its ties to a company that rents out Nvidia GPUs and has borrowed billions of dollars against them.

Nvidia has also put its own credit on the line. It has agreed to guarantee up to $105 billion so OpenAI can lease a data center campus in Ohio that will run on Nvidia chips. Nvidia pays nothing unless OpenAI defaults, but its total guarantees could reach $108.5 billion.

Burry, Chanos Question the Economics

Skeptics argue that Nvidia's growing financial role makes it harder to separate underlying demand for its chips from demand enabled by its own capital.

By investing in customers, backing projects and protecting the value of GPUs used as collateral, Nvidia makes it easier for infrastructure providers to raise money and expand, which in turn creates more demand for Nvidia hardware.

The concern is what happens if that cycle reverses. A slowdown in AI spending would hit GPU values and indebted cloud providers just as Nvidia's own orders slowed, which is exactly when its guarantees would get called.

Short seller Jim Chanos challenged Huang directly this week. When Huang called Nvidia compute "durable and highly rentable" on X, Chanos replied: "Then why not rent them out yourself?"

Michael Burry warned circular spending had reached 'biblical proportions' in July, pointing to a jump in the cost of insuring Nvidia's debt.

Prediction-market traders remain bullish. Polymarket gives Nvidia a 79% chance of finishing 2026 as the world’s largest company by market capitalization, versus about 13% for Apple and 6% for Alphabet.

Nvidia’s underlying business continues to surge. Second-quarter revenue jumped 106% year over year to $96.2 billion, while data center revenue rose 117% to $89 billion.

Image: Shutterstock

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