tech
December 28, 2025
Nvidia insists it isn’t Enron, but its AI deals are testing investor faith
The chipmaker’s sprawling partnerships are driving extraordinary growth but also bank its future on the AI boom paying off quickly
TL;DR
- Nvidia's substantial deals, including $100bn with OpenAI and $22bn with CoreWeave, are drawing comparisons to past corporate financing practices.
- Concerns center on 'vendor financing' arrangements where Nvidia effectively lends money to customers to purchase its chips, a practice reminiscent of Lucent Technologies.
- Nvidia has denied these comparisons, stating its reporting is transparent and unlike Enron, it does not use special-purpose entities to hide debt.
- Analysts worry about the sustainability of Nvidia's growth if AI adoption falters, potentially leading to write-downs and stock price declines.
- Opaque, multi-billion dollar deals with countries like South Korea and Saudi Arabia add further complexity and uncertainty.
- Nvidia's CFO, Colette Kress, dismisses bubble concerns, projecting trillions in future business and replacing existing data center chips.
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