Nvidia is negotiating a $250 billion guarantee that would let OpenAI lease what would become the largest data center ever built. The Wall Street Journal reported July 27 that the proposed facility in southeastern Ohio would require more than $500 billion in total investment and deliver 10 gigawatts of power capacity.
The arrangement would work like this: SoftBank owns the data center developer building the Ohio site. OpenAI, as tenant, lacks an investment-grade credit rating because it remains private and unprofitable. Nvidia's guarantee would let the developer raise debt at far better terms than OpenAI could secure alone.
Nvidia doubles down on vertical integration
Nvidia May Guarantee $250B So OpenAI Can Pay Nvidia
This would not be Nvidia's first bet on OpenAI. The chipmaker has already invested $30 billion in the AI company and is separately discussing a $350 billion deal to fund chip purchases. The pattern is clear: Nvidia wants to own the supply chain from silicon to server rack.
The Journal flagged concerns about "circular funding" in these arrangements. Nvidia sells GPUs to OpenAI, then backstops the buildings that house them. If investor sentiment cools or AI revenue growth slows, the exposure compounds. Both companies would feel the same shock at the same time.
OpenAI's infrastructure shift
Today OpenAI rents compute from Amazon and Microsoft. This Ohio facility would mark its first tenancy in a dedicated site, a step toward controlling its own infrastructure rather than sharing it.
The company recently raised its compute spending forecast from $600 billion to $750 billion through 2030. Whether the Ohio project sits inside or outside that number is unclear. OpenAI has been in advanced lease talks for several weeks, though Anthropic, Google, and Microsoft have also shown interest in the site.
State-level pushback is rising
The deal arrives as data center construction faces growing resistance. New York enacted a one-year moratorium on new data centers earlier this month. Maine's legislature passed a statewide ban, though Governor Janet Mills vetoed it.
Minnesota, Michigan, Pennsylvania, South Carolina, New Hampshire, and Virginia are all considering similar restrictions, according to law firm Foley & Lardner. "If additional states follow suit, New York's decision could become the beginning of a broader regulatory trend rather than an isolated event," the firm wrote.
Ohio, notably, is not on that list. The state's regulatory posture may explain why a facility of this scale landed there rather than closer to existing tech hubs.
Logicity's Take
A $250 billion guarantee from a chip supplier to a customer is not normal. It signals that AI infrastructure has become too expensive and too critical for any single company to fund alone. For fintech teams tracking AI compute costs, this deal sets a new floor: if OpenAI needs a $500 billion facility just to stay competitive, the cost of running frontier models will not drop anytime soon. The circular funding structure also creates systemic risk. Both parties prosper or suffer together.
Regulatory action shaping AI and data center policy in the US
What happens next
Neither Nvidia nor OpenAI has confirmed the discussions publicly. The Journal's sources described the talks as ongoing, not finalized. Given the scale, regulatory scrutiny and financing complexity, any announcement is likely months away.
If the deal closes, it would cement a new model for AI buildout: chip vendors as infrastructure guarantors, not just suppliers. The question for everyone else in the market is whether they can find a partner willing to write a similar check.
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Source: PYMNTS | / PYMNTS
Huma Shazia
Senior AI & Tech Writer
Produced with AI assistance and reviewed by the Logicity editorial team. Learn more in our Editorial Policy.
