Shares of CoreWeave, Nebius, and IREN jumped in early trading on Monday, July 27, following reports that Nvidia plans to provide a $250 billion financing guarantee to aid OpenAI in leasing a vast data center in Ohio. This move has sparked renewed investor hope for growth across the AI infrastructure sector.

Details of Nvidia’s Financial Commitment

The financing guarantee aims to help OpenAI secure more favorable loan conditions for a massive 10-gigawatt data center campus under construction in Pike County, Ohio. This project, led by a SoftBank energy subsidiary, is projected to exceed $500 billion in total costs, including chip expenses.

Nvidia’s guarantee will specifically cover the lease and debt financing of the data center, excluding the cost of Nvidia’s own chips housed inside. Alongside this, Nvidia is reportedly negotiating financing of OpenAI’s chip purchases up to $350 billion.

The initial phase, targeting completion by 2028, will provide approximately 800 megawatts of power, with part of the funding aligned with a recent trade agreement between the U.S. and Japan.

Investor Interest in Neocloud Stocks

For OpenAI, this marks a strategic shift towards owning infrastructure rather than relying on cloud services from Microsoft, Amazon, and Oracle.

Neocloud firms like CoreWeave, Nebius, and IREN, which depend on debt and syndicated loans to fuel growth, are benefiting from Nvidia’s high-profile involvement. This backing could reduce lenders’ risk concerns and ease financing conditions for these smaller GPU cloud providers.

CoreWeave already holds around $22.4 billion in contracts with OpenAI. Since OpenAI lacks an investment-grade credit rating, borrowing costs are high. Nvidia’s guarantee may alleviate some of that financial pressure.

plus Nvidia has direct equity stakes in all three companies: a 9.3% share in Nebius, 47.2 million shares in CoreWeave, and ongoing talks for a $2.1 billion stake in IREN. Nvidia also recently secured a $3.4 billion AI cloud services contract with IREN.

Wall Street analysts currently assign a Moderate Buy rating to all three stocks, with IREN showing the highest potential upside near 103%.

This information is for educational purposes and does not constitute financial advice.