The xAI deal reportedly envisions a $2 billion contribution by Nvidia, as the former plans to raise $7.5 billion in equity and $12.5 billion in debt financing.
Most analysts viewed the OpenAI deal as signaling the potential broader adoption of AMD’s AI chips across OpenAI’s cloud service provider partners and among other players.
An analyst said the process of deploying 1 GW of AMD’s MI450 AI chips is unlikely to be smooth, going by Nvidia’s painful experience with building cabinet-level servers.
Jefferies analysts stated that the OpenAI deal altered AMD’s “AI narrative” and provided “strong validation” of its AI roadmap and the level of AI demand in general.
White House AI Czar David Sacks and Nvidia’s Jensen Huang reportedly expected the UAE chip-supply agreement to help maintain the U.S.’s AI leadership, keeping China at bay.
On the second day of the U.S. government shutdown, Wall Street remains largely subdued, with indexes showing only slight midday declines after touching fresh record highs at the open.
KeyBanc lifted its price target on Nvidia shares to $250 from $230, pointing to improved Chip-on-Wafer-on-Substrate availability through 2025-2026 and better-than-expected rack production yields.
Commerce Secretary Howard Lutnick has reportedly discussed the plan with semiconductor industry executives, emphasizing to them the importance of the measure in ensuring economic security.
Barclays based its new valuation on Nvidia’s earnings potential, forecasting an implied earnings per share of $7.85, adding $35 billion in potential revenue stemming from the chipmaker’s recent collaboration with OpenAI.
