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Jensen Huang says Nvidia is pulling back from OpenAI and Anthropic
- shablulman 8mo ago[flagged]
- dmix 8mo agoA better headline: Nvidia rushed some investments in both companies just before they went public and are now are just waiting to get paid.
- tl2do 8mo agoInstead of pouring more money into OpenAI and Anthropic, Nvidia should invest more in expanding production capacity for the RTX 5000 series and future generations. High-end consumer GPU availability is still constrained, especially for the RTX 5090, and street prices remain elevated. Nvidia should come back to the consumer side.
- chii 8mo agonvidia will come back to the consumer side when the AI side stops being as profitable. Right now, it still seems like the margins for AI hardware is way higher than the same consumer product would sell for.
- returnInfinity 8mo agoAnd why should a business do that? Limited chip production capacity be spent on most profitable ventures.
- tl2do 8mo agoI should admit this is partly my personal preference. That said, gaming has been a durable market for decades, and there’s a strong cycle where better chips enable better games, which then drives more demand for better chips.
- ravst3s 8mo agoThat same virtuous cycle works for their data center segment Every GW of Blackwell generates more revenue than the entire gaming business does in 1 year.
- fishcrackers 8mo ago[dead]
- bigstrat2003 8mo agoIf I were Nvidia, I would give more attention to consumer GPUs to hedge my bets. When (not if) this AI bubble pops, their AI customers will become worthless to them very quickly as they won't be buying more GPUs. And when that day comes, I would want to still have consumers to sell to, rather than have them all buying from AMD because I ignored them.
- bitfilped 8mo agoConsumer GPUs are too small of a slice of their revenue to matter to them anymore.
- bluescrn 8mo agoGaming created Nvidia And now Nvidia is destroying gaming
- armadyl 8mo agothe only way this argument works is if AMD somehow creates GPUs that run circles around nvidia and boxes them out price wise, and at the same them themselves don’t start prioritizing enterprise customers more. otherwise consumers will choose the best performing gpu possible, generally people don’t care about companies turning their backs on consumers in this way
- ChoGGi 8mo agoThey don't need to run circles, just be close enough for a good enough price.
- blitzar 8mo agoYou saying they should have gone all in on Crypto mining?
- wingmanjd 8mo agoDatacenter income for nVidia last quarter was something like 62B vs the gaming market of <4B. While not quite a rounding error, it feels like the gaming market is just too small for them to put more resources toward it for us consumer folks. https://nvidianews.nvidia.com/news/nvidia-announces-financial-results-for-fourth-quarter-and-fiscal-2026 https://nvidianews.nvidia.com/news/nvidia-announces-financia...
- PenguinCoder 8mo agoIt is insanely stupid that '4B' with a B, is 'too small' of an operating space.
- chii 8mo agoThe absolute value is irrelevant - it's the opportunity cost that determines this. It doesn't matter if the consumer market is 4T, if the AI market is 60T!
- zmgsabst 8mo ago“I wouldn’t pick up $20 if there was $100 on the ground!” Most people would pick up both. These economic proclamations don’t seem to make sense, when applied to different contexts — which suggests what you’re saying might be folk wisdom rather than sound theory (and greatly over simplifying the problem). You’re also discounting ecosystem effects — gaming GPUs driving demand for datacenter and workstation GPUs as hobbyist experimentation turns into industrial usage. We don’t know what would happen if nVidia stopped suppressing the GPU market, because it’s never been tried — nVidia has always viciously undercut their own grassroots.
- reilly3000 8mo agoThis leaves an opening for Intel to get in the game. Their new lines have a pretty decent value proposition for mid-tier gaming. If they focused on the higher end they would could own it. There is massive latent demand because of the NVidia situation. It’s easier to make money from than the R&D to build the next Blackwell but there is just as much demand for local/private models on the prosumer level.
- eitally 8mo agoWhy would they do that? They launched the DGX Spark last year with multiple hardware OEMs selling flavors of the reference device (Dell, Lenovo, Asus). That contains a desktop-sized Grace Blackwell architecture GPU (GB10), and word on the street is that they're moving into laptops this year. Their market is the same market Apple is pitching the MacBook 5 Pro/Max, too: devs wanting local models. It's not currently a large market, but it's growing quickly. It makes far more sense for Nvidia to build hardware to service this market than to overly focus on their gaming lines. RTX GPUs are sell once. GB-containing consumer devices are "sell once, but then collect recurring revenue when the workloads those developers build hit production on a cloud somewhere."
- Shitty-kitty 8mo agoNvidia designs chips, it has no production capabilities. Most of their chips are produced by TSMC and memory come from SK Hynix.
- dev_l1x_be 8mo agoTheir model offerings are also need some love.
- TiredOfLife 8mo agoFabs are expensive, take decades to make and most important are very hard.
- mrweasel 8mo ago> Nvidia should invest more in expanding production capacity Not if they expect build out of AI data centers to slow down. Once both OpenAI and Anthropic goes public there's going to be a pressure on them to either turn a profit or at least have the stock price go up. One way that can happen, if subscriptions, government contracts and ads aren't working, is cutting back on cost. Cutting costs means doing more with the existing GPUs and datacenters and running them for longer. Even if the both companies can turn a profit, there's going to be a pressure to not spend on datacenters, if existing facilities can be pushed harder or used more efficiently. OpenAI and Anthropic going public is going to mean reduced spend on datacenters and GPUs.
- cmxch 8mo agoNo problem with that, even if it takes force.
- deleted 8mo ago[deleted]
- SamDc73 8mo agoThe Stargate money didn’t show up I guess, and now the whole gridlock is collapsing?
- 01100011 8mo agoNvidia could flip a switch and start competing with former customers. They have the talent, the models, the HW, and they know how to quickly build out DCs.
- y1n0 8mo agoThat would not go well for nvidia. Why would they want to enter and compete in a market where everybody is losing money? And in so doing alienate the people that make them profitable?
- mlyle 8mo agoIf those customers end up profitable, it could be tempting for nVidia to vertically integrate. I don't think it's as easy as others say, though.
- eitally 8mo agoThey don't, not directly. That's why they've generally been winding down DGX Cloud. However, lots of folks dramatically underestimate their frontier models (Nemotron family), and they license those models (free) for embedding in MANY other, large tech companies' own products and platforms, which either directly or indirectly consume massive quantities of GPU time. Nvidia is best known for selling huge volumes of GPUs to the hyperscalers & neoclouds, but I don't think lots of folks appreciate how many GPUs ISVs like Snowflake, Databricks, Teradata, etc consume, too, just by virtue of designing much of their internal products around CUDA & Nemotron.
- estimator7292 8mo agoPresumably Nvidia would have a significant advantage on hardware costs, and could run custom hardware that the rest of the market will never see
- wood_spirit 8mo agoAnd they have a moat - they can control the quantity and quality of hardware flowing to their competitions?
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- whynotminot 8mo agoAs long as both companies remain stable and viable, there's probably limited upside to pouring more money into them. If they fail, and bring down the AI ecosystem with them, that is very bad news for Nvidia. So they've been there nurturing their success and providing capital to backstop their exponential growth. You can see Nvidia stepping in throughout the ecosystem with confidence boosting investments where needed. They haven't just supported Anthropic and OpenAI. If OpenAI and Anthropic succeed, and get their business fly-wheels fully spinning, they don't necessarily need more capital from Huang. Ultimately the goal of Nvidia is to profit from their long-term success by selling them GPUs for a long, long time. The goal isn't to keep plowing money into them forever.
- adventured 8mo agoThese days Nvidia has more money than it knows what to do with. They could certainly push $5b+ into each company annually and never miss it. They're tracking toward an astounding $200b in operating income (maybe over the next four quarters if the music doesn't suddenly stop).
- locusofself 8mo ago5 billion doesn't look like much when OpenAI just raised $110b though. And how sustainable is NVDA's immense profits if this bubble actually bursts?
- Kina 8mo agoIt did not raise $110 billion. According to their own SEC filings $35 billion of Amazon’s funding is contingent on “(i) OpenAI meeting specified milestones, and (ii) OpenAI directly or indirectly consummating an initial public offering or direct listing of equity securities in the United States”
- lelanthran 8mo ago> 5 billion doesn't look like much when OpenAI just raised $110b though. Just about all of the AI providers "raises" are a fraction of the reported "raise", like this one. They didn't "raise" $100b. They got commitments for $35b, with said commitments being dependent on meeting certain criteria. Every "raise of $FOO" I've seen in the past year or two has not resulted in them getting their hands on $FOO in cash to spend.
- deleted 8mo ago[deleted]
- codemac 8mo ago> Nvidia CEO Jensen Huang said his company’s recent investments in OpenAI and Anthropic are likely to be its last in both, saying that once they go public as anticipated later this year, the opportunity to invest closes ok, sounds obvious > Nvidia, for its part, isn’t offering much more on the matter ok, so no more news from nvidia > Still, a few other dynamics might also explain the pullback.. Wait it's a pullback? This is terrible reporting, right?
- bitfilped 8mo agoThis is several investment rounds in so I think it might be fair to say it's a pullback.
- vessenes 8mo agoAlmost all reporting is terrible. But yes, this is terrible reporting.
- aurareturn 8mo agoThe next round is IPO for both companies. I don't know why the headline is written like that. Super click baity.
- samrus 8mo agoPerfectly reasonable from Nvidia's side. But now thats one less way for sal altman to engineer the valuation upwards
- feverzsj 8mo agoEveryone knows the bubble is bursting.
- SpicyLemonZest 8mo agoI don't really understand the idea that not investing more money is a "pullback". Have VC norms propagated so far that any company that makes any investment is presumed to be interested in repeated future rounds?
- seydor 8mo agoThe important news is that OpenAI and Anthropic are pulling out from NVidia; they are not public companies.
- _ache_ 8mo agoMy bet is Nvidia is using massive AI ability to dictate its investments. And it logically predict that not much (more) investments are needed and it need time to become profitable. That a signal that nobody should invest more in the IA big companies and now they MUST become profitable soon.
- m000 8mo agoOr it predicted that they will crash, so they'd better be out before everyone else realizes.
- captainbland 8mo agoAfter seeing natural gas prices spike like that I'd probably pull out of such an energy intensive investment too
- Havoc 8mo agoThat reads more as an image move. Better of they can position themselves as a provider of neutral tools and stay far away from the DoW discussion on use of said tools
- gilbetron 8mo agoI think it is likely that they realize that LLM models will be able to be developed by many companies, and I see most early, heavy adopters of LLMs doing the math on giving OpenAI/Anthropic token fees versus just having in-house models, and realizing that, at this point, it sure seems like having your own models might be the future path. Nvidia is in position, and has the resources, to see this with a much broader lens, and realizes OpenAI/Anthropic won't be able to corner the market and the long term play is to sell GPUs to cloud providers and companies themselves.
- dmix 8mo agoThe article already explains why, both of the companies have taken a huge amount of capital so further investing doesn't make sense and they will both go public soon where they will raise more. Both companies will need Nvidia products regardless if Nvidia puts capital into the companies. So this is not 'pulling back' as the headline says.
- alecco 8mo agoBlogspam derived from the original article by CNBC, with clickbait title. > [subtitle] Nvidia CEO Jensen Huang said the company’s recent $30 billion investment in OpenAI “might be the last time” it invests in the AI startup as it gears up to go public. Jensen meant he expects no more rounds before IPO. [0] https://www.cnbc.com/2026/03/04/nvidia-huang-openai-investment.html https://www.cnbc.com/2026/03/04/nvidia-huang-openai-investme...
- 7777777phil 8mo agoNvidia sells chips to whoever wins, so investing in a specific lab creates downside with no real upside. The more interesting read is whether Huang sees model providers compressing toward commodity pricing. I wrote about why that layer is structurally squeezed: https://philippdubach.com/posts/is-ai-really-eating-the-world-1/ https://philippdubach.com/posts/is-ai-really-eating-the-worl...
- lousken 8mo agoOpenAI and Anthropic are better off with cerebras rather than nvidia
- mdni007 8mo agoIf this AI bubble pops we'll just have a ton of cheap powerful GPUs on the market and possibly even an uptick in job growth in tech.