Nvidia is leveraging its massive free cash flow to finance AI infrastructure, shifting from equity investments to providing backstops and lending for data center buildouts. NVDA's direct equity stakes in AI startups like OpenAI and Anthropic are minor relative to its market cap, with potential gains amounting to less than 2% of valuation. By supporting up to $500B in AI hardware spending with limited risk, NVDA can generate gross profits that far exceed potential backstop losses, reinforcing its dominant position.
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