Silicon Valley is plowing money into AI, and the latest deals are eye-watering


It seems a week doesn’t go by that a massive AI deal isn’t announced. OpenAI (OPAI.PVT), Nvidia (NVDA), AMD (AMD), Oracle (ORCL), Broadcom (AVGO), and a raft of other companies are spending billions investing in each other and each other’s hardware.

But the flurry of back-and-forth moves has come at such a rapid clip that it’s difficult for even the closest tech watcher to keep track of who is investing in whom.

So I’m going to run through the latest announcements to make the industry’s biggest AI agreements just a bit easier to follow and help you understand what each company is doing and why.

OpenAI is the company making the most waves in the dealmaking space of late. The ChatGPT developer signed a massive contract in September with Nvidia that will see the chipmaker invest up to $100 billion in the company in exchange for OpenAI purchasing upwards of 10 gigawatts of GPUs over several years.

The first phase of the partnership kicks off in the second half of 2026, when Nvidia will begin deploying its next-generation Vera Rubin superchips.

OpenAI CEO Sam Altman. REUTERS/Kim Kyung-Hoon · Reuters / Reuters

Just a month later, OpenAI unveiled an agreement with Nvidia rival AMD that will see the Sam Altman-helmed AI firm purchase shares equivalent to roughly 10% of the chip company in exchange for upwards of 6 gigawatts of GPUs.

As with the Nvidia deal, AMD will supply OpenAI with its next-generation MI450 AI chips beginning in the second half of 2026.

OpenAI wasn’t done making moves just yet, though. This week, it let fly with its latest news, a 10 gigawatt transaction with Broadcom through which the two will co-develop custom chips to run OpenAI’s AI models and services.

OpenAI will design the accelerators and systems, and Broadcom will develop and deploy them.

All totalled, OpenAI has signed deals worth up to 26 gigawatts of GPUs over the time of the three agreements. One gigawatt of electricity is enough to power 800,000 homes, according to Reuters. Those 26 gigawatts then work out to roughly 20.8 million homes.

OpenAI has also signed an agreement with Oracle as part of the company’s Stargate Project. Worth more than $300 billion, the deal, announced in July and fully revealed in September, is one of the AI giant’s most ambitious ventures and will give OpenAI an additional 4.5 gigawatts of GPUs over the next five years.

Oracle isn’t just working with OpenAI. On Tuesday, the cloud computing company said it will purchase upwards of 50,000 AMD GPUs starting with its MI450 chips in the second half of 2026.

Oracle also reportedly signed an earlier deal to purchase $40 billion worth of Nvidia chips for OpenAI’s Startgate Project, according to the Financial Times.

All of this is taking place as other cloud and AI behemoths, including Amazon (AMZN), Google (GOOG, GOOGL), Meta (META), Microsoft (MSFT), and xAI (XAAI.PVT), continue to plow their own cash into purchasing AI chips and capacity.

The spending has led to concerns about circular investing and an AI bubble similar to the dot-com bubble of the late 1990s and early 2000s.

But others have pushed back on the premise, saying that the flood of AI spending is backed up by strong corporate balance sheets and earnings results.

Even if there is a bubble, though, the investments could eventually pay off.

“I actually do believe that there is significant long-term demand,” Ram Bala, associate professor of business analytics at the Leavey School of Business at Santa Clara University, told Yahoo Finance last week.

“I think it’s definitely going to pan out. The macroeconomic challenge is … there’s probably going to be this intermediate phase where it seems like we overbuilt a lot of this and demand isn’t quite catching up to all of that.”

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Email Daniel Howley at dhowley@yahoofinance.com. Follow him on X/Twitter at @DanielHowley.

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