Amazon is seeking to transfer about $8bn worth of advanced Nvidia artificial intelligence chips to investors through a new financing structure, as the technology giant looks to strengthen its balance sheet while continuing to use the expensive hardware.
The Financial Times reported on Friday, citing people familiar with the matter, that Amazon had held discussions with potential investors in recent weeks to gauge interest in the proposed transaction.
The deal would involve thousands of Nvidia Grace Blackwell chips that Amazon is installing in data centres across the United States.
Under the proposed arrangement, the chips would be transferred to a special-purpose vehicle, or SPV, that would raise funds from outside investors through debt issuance.
Amazon would then lease the chips back from the vehicle, allowing it to continue using the processors for its artificial intelligence and cloud computing operations.
The structure would effectively enable Amazon to raise funds against some of its AI infrastructure assets without giving up access to the chips needed to run its data centres.
The Financial Times reported that Amazon could offer investors an equity stake of up to 10 per cent in the special-purpose vehicle.
The chips covered by the proposed transaction were either purchased or leased by Amazon and are installed in more than a dozen data centres across five US states, including Nevada and Virginia, according to the report.
The proposed arrangement would give Amazon a more asset-light approach to financing its rapidly expanding AI infrastructure. Rather than carrying the full cost of the expensive processors on its balance sheet, the company could transfer ownership of the assets to the investment vehicle while paying to use them.
The move comes as Amazon and other major technology companies continue to spend heavily on data centres, high-performance computing equipment and specialised AI processors to support the growing demand for artificial intelligence services.
Nvidia’s Grace Blackwell platform combines computing and networking technologies designed for demanding AI workloads, making its processors a major component of the infrastructure being deployed by cloud and technology companies.
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Amazon has been expanding its computing infrastructure as it competes in the fast-growing AI market through its cloud computing business, Amazon Web Services.
The proposed chip financing arrangement could therefore provide Amazon with additional capital while allowing it to maintain the computing capacity required for its AI and cloud businesses.
For investors, the structure would provide exposure to a pool of high-value computing assets while Amazon would remain responsible for using the chips under the lease arrangement.
The Financial Times report did not indicate that a final agreement had been reached or identify the investors involved in the discussions.
Amazon and Nvidia did not immediately respond to Reuters’ requests for comment outside regular business hours.
If completed, the transaction would represent another way for major technology companies to finance the huge infrastructure costs associated with the expansion of artificial intelligence without relying entirely on conventional corporate spending.
About the Author
Cecilia Attah is a tech analyst with a degree from Benue State University. She covers tech news and startups at TechRegard with a focus on how technology is transforming Africa and shaping the global landscape.
