WSJ report alleges Nvidia funded startups to buy its GPUs
Original title: Nvidia Allegedly Engineered Scarcity by Funding AI Startups to Buy Its GPUs
The report says circular financing was meant to absorb a TSMC GPU oversupply after hyperscalers shifted toward custom chips.
A Wall Street Journal report, relayed by TechPowerUp, alleges Nvidia invested in AI startups so they would buy Nvidia GPUs and build data centers, sustaining the appearance of demand. It cites an August meeting in which CFO and acting CEO Colette Kress urged scaling back circular financing, including a $250 billion OpenAI deal, while Jensen Huang allegedly pushed more investment into small cloud providers. The report says those providers might not afford the GPUs and that Nvidia faced an oversupply from TSMC.
Unconfirmed: The account rests on a Wall Street Journal report and is not confirmed by Nvidia.
- Kress allegedly sought to reduce circular financing agreements.
- The disputed OpenAI arrangement is described as a $250 billion deal.
- Hyperscalers were said to be moving from off-the-shelf parts to custom chips.
- Small cloud providers Nvidia backed might be unable to buy the GPUs.
- Vendors
- NVIDIA
From the original article
1 min read at techpowerup.com
Following the departure of now-former NVIDIA CEO, Jensen Huang , a new report by The Wall Street Journal (via Wccftech ) has emerged alleging that NVIDIA artificially inflated the ongoing GPU and memory shortage by investing in AI startups that would go on to buy NVIDIA GPUs and build data centers.
By speckx · techpowerup.com
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