27 August 2026
Nvidia CEO defends billions in AI company financing as necessary, not circular
First reported
CNBC and The Verge ran this on , all on the same day.
- Nvidia, the chipmaker dominating the market for processors that power AI systems, has invested heavily in AI startups and data center projects, drawing criticism it is artificially inflating its own sales through circular financing arrangements.
- CEO Jensen Huang argued on CNBC that AI companies need tens of billions of dollars to become profitable, an unprecedented requirement that justifies Nvidia's financial support as partnership rather than self-dealing.
- Huang stated these AI companies lack investment-grade credit ratings and cannot borrow money cheaply elsewhere, so Nvidia's financing fills a genuine gap while remaining low-risk because computing hardware can be redeployed if any single company fails.
- Nvidia reported $96.2 billion in quarterly revenue, more than double year-over-year, with data center sales up 117 percent, and projected 70 percent revenue growth for the following year.