Nvidia is doubling down on its AI infrastructure strategy with a significant new investment in CoreWeave, a leading cloud provider specializing in graphics-intensive computing. The chip giant announced a $2 billion commitment to CoreWeave, furthering CEO Jensen Huang’s vision of building a robust “five-layer cake” for artificial intelligence development. This latest infusion of capital is earmarked to help CoreWeave expand its data center capacity to over five gigawatts by 2030, leveraging Nvidia’s cutting-edge technology.
These massive data centers, which Huang refers to as “AI factories,” are designed to handle computational loads equivalent to small cities during peak operations. CoreWeave has relied on Nvidia’s high-performance GPUs and networking solutions since its inception. The expanded partnership will see CoreWeave integrating Nvidia’s Vera CPU and BlueField storage products, signaling a deeper embrace of Nvidia’s comprehensive ecosystem.
The investment comes as CoreWeave has seen a surge in its valuation. Following its IPO in March 2025, the company’s stock experienced a significant rally. The recent private placement of nearly 22.94 million shares to Nvidia at $87.20 per share, executed on Friday, further bolstered its market position. The stock jumped as much as 16.8% in early trading on Monday, reaching a session high above $108 before moderating later in the day. Nvidia’s shares saw a modest decline. Prior to this latest investment, Nvidia already held a substantial stake in CoreWeave, owning 24.28 million shares as of September.
While some might label this a “circular investing” strategy—where Nvidia invests in a customer who then buys its products—the company views it as a strategic imperative. Nvidia possesses ample capital, reducing reliance on external markets for funding. Rather than merely “propping up” companies, Huang emphasizes that Nvidia’s investments represent a fraction of the total capital required to realize the ambitious AI buildout. These ventures, including those with CoreWeave and OpenAI, necessitate substantial further funding from the companies themselves.
For Nvidia investors, these strategic investments are designed to deploy excess cash effectively. Instead of solely pursuing market-based returns through stock purchases, Nvidia is strengthening its customer base. This not only secures future demand for its hardware as it evolves and software expands but also encourages broader industry adoption of its technology. Competitors and collaborators alike will find it increasingly necessary to utilize Nvidia’s offerings to attract and retain customers in the burgeoning AI landscape. The potential for both direct financial returns, as demonstrated by CoreWeave’s stock performance, and significant indirect benefits through ecosystem fortification is substantial.
Huang likens the AI infrastructure to a five-layer cake. The base layer is energy, followed by the chip layer, which Nvidia dominates. CoreWeave and other cloud providers form the infrastructure layer. AI models, such as OpenAI’s ChatGPT and Google’s Gemini, constitute the next layer, with applications for consumers and enterprises topping the structure. Nvidia’s ambition extends beyond the chip layer; it seeks strategic investments across all these levels, mirroring the opportunity for its investors.
The demand for both AI software and hardware remains exceptionally strong, driven by the race for next-generation pre-training, post-training, and inference capabilities. Huang also noted a recent surge in investments in the “application” layer of AI, which he believes is pivotal for transforming industries.
CoreWeave CEO Michael Intrator echoed the strategic importance of the partnership, highlighting its alignment on physical infrastructure, software development, and its validation of CoreWeave’s ability to deliver leading-edge solutions. This collaboration also enables CoreWeave to offer its software to on-premise data center clients.
Separately, Nvidia’s financial outlook for its upcoming quarterly earnings release explicitly excludes any revenue or future business from China. However, Huang expressed anticipation for the finalization of H200 licenses and is hopeful for the Chinese government’s consideration of re-entry into the market. He affirmed that demand for the H200 and Nvidia’s overall technology stack remains significant in China. Huang made these remarks from China, where he was preparing to observe the Chinese New Year. Many Chinese tech firms have shown interest in H200 chips following the U.S. government’s late-year decision to permit their export, a reversal of previous restrictions aimed at preventing the hardware from reaching the Chinese military. The U.S. government is set to receive a 25% share of these chip sales.
Nvidia’s stock performance in early 2026 has been relatively flat, following a nearly 39% gain in the previous year. After reaching a record high of $207 in late October, the stock closed Friday at approximately $188, marking a drop of just over 9%. Analysts suggest that the current valuation may present an attractive entry point, anticipating further earnings growth.
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