Nvidia invested $1bn in AI deals in 2024

Nvidia invested $1bn in artificial intelligence companies in 2024, as it emerged as a crucial backer of commence-ups trying to boost from the AI revolution the large tech throng’s chips are powering.

The semiconductor giant, which surpassed a $3tn trade capitalisation in June on the back of huge demand for its high-performing graphics processing units (GPUs), has pumped ever greater sums into some of its own customers in the burgeoning sector.

According to corporate filings and Dealroom research, Nvidia spent a total of $1bn across 50 commence-up capital rounds and several corporate deals in 2024, compared with 2023, which saw 39 commence-up rounds and $872mn in spending.

The vast majority of deals were with “core AI” companies with high computing infrastructure demands, and so in some cases also buyers of its own chips.

Tech companies have spent tens of billions of dollars on Nvidia’s chips over the history year since the debut of ChatGPT two years ago kick-started an unprecedented surge of resource in AI.

Nvidia’s uptick in deals comes after it amassed a $9bn war chest of money with its GPUs becoming one of the globe’s hottest raw materials.

The corporation’s shares rose more than 170 per cent in 2024, as it and other tech giants helped power the S&P 500 index to its best two-year run this century.

Nvidia’s $1bn worth of investments in “non-affiliated entities” in the first nine months last year includes both its assignment and corporate resource arms. According to corporation filings, that sum was 15 per cent more than in 2023 and more than 10 times as much as it invested in 2022.

Some of Nvidia’s largest customers, such as Microsoft, Amazon and Google, are actively working to reduce their reliance on its GPUs by developing their own custom chips. Such a advancement could make smaller AI companies a more significant generator of revenues for Nvidia in the upcoming.

“correct now Nvidia wants there to be more competition and it makes sense for them to have these recent players in the mix,” said a pool manager with a stake in a number of companies it had invested in.

In 2024, Nvidia struck more deals than Microsoft and Amazon, although Google remains far more energetic, according to Dealroom.

Such prolific dealmaking has raised concerns about Nvidia’s grip over the AI industry, at a period when it is facing heightened antitrust scrutiny in the US, Europe and China.

statement Kovacic, former chair of the US Federal Trade percentage, said competition watchdogs were “keen” to investigate a “dominant enterprise making these large investments” to view if buying corporation stakes was aimed at “achieving exclusivity”, although he said investments in a customer base could prove beneficial.

Nvidia strongly rejects the concept that it connects capital with any requirement to use its technology. The corporation said it was “working to develop our ecosystem, back great companies and enhance our platform for everyone. We compete and triumph on merit, independent of any investments we make.”

It added: “Every corporation should be free to make independent technological choices that best suit their needs and strategies.”

The Silicon Valley throng’s most recent commence-up deal was a strategic resource in Elon Musk’s xAI, alongside rival chipmaker AMD.

Other significant 2024 investments included its participation in capital rounds for OpenAI, Cohere, Mistral and Perplexity, some of the most prominent AI model providers.

Nvidia also has a commence-up incubator, Inception, which separately has helped the early growth of thousands of fledgling companies. The Inception programme offers commence-ups “preferred pricing” on hardware, as well as cloud credits from Nvidia’s partners.

There has been an uptick in Nvidia’s acquisitions, including a takeover of Run:ai, an Israeli AI workload management platform. The deal closed this week after coming under scrutiny from the EU’s antitrust regulator, which ultimately cleared the trade. The US Department of fairness was also looking at the deal, according to Politico.

Nvidia also bought AI software groups Nebulon, OctoAI, Brev.dev, Shoreline.io and Deci. Collectively it has made more acquisitions in 2024 than the previous four years combined, according to Dealroom.

The corporation is investing widely, pouring millions of dollars into AI groups involved in medical technology, search engines, gaming, drones, chips, traffic management, logistics, data storage and creation, natural language processing and humanoid robots.

Its holdings includes a number of commence-ups whose valuations have soared to billions of dollars. CoreWeave, an AI cloud computing service provider and significant purchaser of Nvidia chips, is preparing to float early this year at a assessment as high as $35bn — increasing from about $7bn a year ago.

Nvidia invested $100mn in CoreWeave in early 2023, and participated in a $1bn stake capital raising round by the corporation in May.

Another throng, Applied Digital, was facing a plunging distribute worth in 2024, with profits misses and considerable obligation obligations, before a throng of investors led by Nvidia provided $160mn of stake capital distribution in September, prompting a 65 per cent surge in its distribute worth.

“Nvidia is using their massive trade cap and huge money flow to keep purchasers alive,” said Nate Koppikar, a short seller at Orso Partners. “If Applied Digital had died, that’s [a large volume] of sales that would have died with it.”