CNBC's Kristina Partsinevelos joins 'Money Movers' to discuss how Nvidia has become the AI industry's preferred lender.

The release of Open AI's ChatGPT has accelerated the development of artificial intelligence and warnings about its impact on society.

Rise of AI

Nvidia is increasingly positioning itself as a central figure in the artificial intelligence industry, not just by supplying chips but also by acting as an investor and financier. Recent reports highlight Nvidia's planned $2 billion investment in Elon Musk's X.AI as part of a larger funding round, with a significant portion structured as debt to purchase Nvidia chips, which X.AI will then rent out.

The company has amassed over $100 billion in exposure across the AI ecosystem, including commitments to OpenAI, stakes in cloud service providers, and investments in more than 100 AI startups. Nvidia's strategy often involves playing multiple roles in deals—supplier, investor, financier, and customer—raising questions about whether it is using its financial strength to sustain demand for its own products.

Nvidia's self-funded AI loop

Nvidia CEO Jensen Wang joining Swapbox this morning talking up all the investments he's been making lately in A.I. startups and saying he's looking for even more for today's tech check. Christina Parts Neville is taking a look at Nvidia as the new A.I. Bank not just the center of the innovation action with chips. Yeah I'm going to explain the bank analogy but Nvidia may be the most valuable company in the world. But it's also to your point becoming the A.I. industry's preferred lender. So Bloomberg reported the company plans to invest two billion dollars in Elon Musk as X.A.I. as part of a 20 billion dollar funding round under the deal. About twelve point five billion will be raised as debt through a special purpose vehicle that buys Nvidia chips which X.A.I. then rents out for five years. Nvidia CEO Jensen Wang told CNBC this morning about the importance of investing in the entire ecosystem of A.I. listening. The only regret I have about X.A.I. we're an investor already. The only regret I have is I didn't give him more money. We've made some really terrific investments and largely my only regret is that we didn't invest invest more. Backed by some serious capital between a one hundred billion dollar commitment to open A.I. as six point three billion dollar cloud service purchase for from core. We were also holds a 7 percent stake in Corrie and venture bets over 100 A.I. startups. Nvidia has amassed over one hundred billion dollars in exposure across the entire A.I. ecosystem and that number is conservative. But there is a pattern in these investments in the core deal alone. Nvidia plays for let's call it conflicting roles. Supplier of chips equity investor with a 7 percent stake financier with buyback guarantees for excess capacity and customer purchasing roughly six point three billion dollars in cloud services. With X.A.I. Nvidia is again both investor and supplier financing a company that will buy its own products by Nvidia chips. The X.A.I. deal introduces what amounts to chip backed debt asset backed securities where the collateral is depreciating GPU compute capacity. We can debate how that depreciation cycle is. Is it six years three years less. The question is no longer whether Nvidia dominates A.I. hardware it's whether the company is using its huge cash hoard to prop up demand for its own products guys. Yeah that's where the whole circular revenue conversation comes in. Christina thank you.

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Los Angeles

Man arrested for allegedly starting Palisades Fire in California

Former FBI Director James Comey pleaded not guilty to two counts in federal court on Wednesday (October 8) after being indicted by the U.S. Department of Justice in September.

Alexandria

James Comey pleads not guilty to charges brought by Trump's DOJ

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Washington

Government shutdown, staffing issues lead to flight delays

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Sharm El-Sheikh

Middle East Conflict

Hamas says it is ready to reach Gaza deal but needs 'real' guarantees

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Paris

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Jerusalem

Israeli strikes intensify in Gaza despite ceasefire talks

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Mexico City

Palestinian solidarity protests sweep Latin America

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Chicago

National Guard troops preparing to deploy in Chicago

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Global Tariffs

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Tel Aviv-Yafo

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Riyadh

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Stockholm

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Cairo

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Israel deports Greta Thunberg after Gaza Flotilla interception

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Santa Clara

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Gorakshep

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Indianapolis

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Portland

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Santa Teresa

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Nvidia's self-funded AI loop

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Rise of AI