This article first appeared on GuruFocus.
Nvidia (NASDAQ:NVDA) shares slid about 1.5% on Monday after a report said its planned investment in OpenAI may not move forward as first outlined.
The Wall Street Journal reported that discussions between Nvidia and OpenAI have slowed, citing people familiar with the matter. Nvidia had said in September it could invest up to $100 billion in the artificial intelligence company and help build large-scale computing capacity.
Chief Executive Jensen Huang later told industry contacts that the investment was not binding and had not been finalized, the report said. He also raised concerns about OpenAI’s business approach and competition from companies such as Alphabet’s Google (NASDAQ:GOOGL) and Anthropic.
Over the weekend, Huang said claims of dissatisfaction with OpenAI were nonsense, but added that the investment would not exceed $100 billion. He said Nvidia would still take part in the funding round led by OpenAI Chief Executive Sam Altman, according to comments reported by Bloomberg.
Investors appeared cautious about the uncertainty around the deal size. Sarah Kunst of Cleo Capital said the shifting tone on the amount to be invested may be adding to market unease.
Nvidia shares are up sharply over the past year, driven by strong demand for AI chips.
