While gold, real estate and stocks are common investment choices, Nvidia CEO Jensen Huang wants investors to ride on the AI bandwagon and turn chips into Wall Street’s newest asset class, partnering with six large asset managers on a $500 billion financing push.
Nvidia on Monday announced that it had signed memorandums of understanding with Blackstone, BlackRock, Goldman Sachs and others to build financing platforms for the company’s customers.
"This is really the first time that technology chips have become an investable asset class…These are revenue-generating assets now. They’re productive, they are long-lived, they are fungible, they are flexible," Nvidia founder and CEO Jensen Huang told CNBC.
The company aims to mobilise more than $500 billion of third-party capital for the buildout of AI infrastructure over time. "We began by building chips; today, we are helping create a new class of productive, investable infrastructure: AI factories," Huang said in a press release.
He noted that compute is revenue in the case of artificial intelligence, and Nvidia is uniquely suited for this. "That is why we are bringing the world's leading long-term capital providers together to independently underwrite AI infrastructure. These financing platforms will help customers access scarce compute at scale and build the DSX AI factories that will power every industry and country in the age of AI," he further said.
GPUs historically have been seen as rapidly depreciating hardware. Nvidia’s latest efforts challenge that assumption, transforming AI compute capacity into long-term, bankable infrastructure. "Fundamentally, what’s different about this industry and this way of doing computing is that the computer is now part of the infrastructure, like electricity, like the internet, and so you have to think about it like it’s infrastructure," Huang said during his interview with CNBC.
The AI buildout will require unprecedented investment and a skilled workforce to turn that investment into the infrastructure that will help power future growth, said Larry Fink, Chairman and CEO of BlackRock.
KKR Co-CEOs Joe Bae and Scott Nuttall meanwhile said that compute has become a critical infrastructure asset. “As we have scaled our approach to digital infrastructure, we have learned that delivery, not ambition, is the hard part,” they added.
Nvidia’s push to make chips an investable asset comes amid the topsy-turvy AI trade seen this year so far. While hyperscalers pour in billions of dollars into AI infrastructure, analysts question if such massive investments will actually bear fruit in future.
Also read | AI frenzy spooks investors, but JPMorgan CEO Jamie Dimon says spending boom likely to pay off. Here's why
(With inputs from agencies)
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