Nvidia Strikes $1.5 Billion Deal to Lease Back Its Own AI Chips from Cloud Startup Lambda

Nvidia signs $1.5 billion deal with cloud startup Lambda to rent back its own AI chips -- 18,000 GPUs will be leased over 4 years, as Lambda gears up for its IPO

Nvidia, the company powering essentially the entire AI boom, is now looking to rent back its own chips. According to The Information, Nvidia has now signed a deal with Lambda, a cloud service provider in which it has already invested, to lease back some of its own GPUs over a period of time. The details of the purported agreement are unclear, but reports suggest a four-year lease for 10,000 GPUs, valued at approximately $1.3 billion, followed by a separate $200 million deal for an additional 8,000 (likely lower-end/older) chips. These are Nvidia GPU servers that Lambda once bought from the company, and now the chipmaker wants to rent these back. This contract will make Nvidia, by far, the biggest client under Lambda's belt. Lambda, for those unaware, is a cloud startup that opened its doors in 2012. It rents out AI server capacity to companies like Microsoft and Amazon, but is also in line to serve Google, OpenAI, xAI, and Anthropic. Interestingly, these leased GPU servers will reportedly be used in-house by Nvidia's researchers, much like Amazon and Microsoft use Lambda's services. Both companies are hyperscalers themselves, but they mainly utilize Lambda's servers for internal purposes rather than subletting them through AWS or Azure platforms, respectively. For Nvidia, this is nothing unusual as it's predictably biased toward companies that use its products. CoreWeave, another AI startup, was majorly aided by Nvidia with multiple investment rounds and a very similar GPU-renting deal. CoreWeave even sought a $2.3 billion loan using its H100 GPUs reserve as collateral back in 2023.

Nvidia agreed this summer to rent 10,000 of its own AI chips from the cloud firm, Lambda, for $1.3 billion over four years- The Information

NVIDIA Corporation is the world leader in the design, development, and marketing of programmable graphics processors. The group also develops associated software. Net sales break down by family of products as follows: - computing and networking solutions (77.8%): data center platforms and infrastructure, Ethernet interconnect solutions, high-performance computing solutions, platforms and solutions for autonomous and intelligent vehicles, solutions for enterprise artificial intelligence infrastructure, crypto-currency mining processors, embedded computer boards for robotics, teaching, learning and artificial intelligence development, etc.; - graphics processors (22.2%): for PCs, game consoles, video game streaming platforms, workstations, etc. (GeForce, NVIDIA RTX, Quadro brands, etc.). The group also offers laptops, desktops, gaming computers, computer peripherals (monitors, mice, joysticks, remote controls, etc.), software for visual and virtual computing, platforms for automotive infotainment systems and cloud collaboration platforms. Net sales break down by industry between data storage (78%), gaming (17.1%), professional visualization (2.5%), automotive (1.8%) and other (0.6%). Net sales are distributed geographically as follows: the United States (44.3%), Taiwan (22%), China (16.9%) and other (16.8%).