"Nvidia could make the argument that it is simply investing to help companies support transactions they would have made anyway. Another investor would have paid the revenue it received from these transactions. What would be different is that another large tech company or outside institutional investors would have seen the transaction only as a way to push up the valuation of their Nvidia equity ownership. The revenue benefit to them would be zero."
"In August, Nvidia disclosed that a large portion of its revenue from the previous quarter was from two unidentified customers. The company gave them special designations in an SEC filing. "Customer A" made up 23% of total revenue, and "Customer B" comprised 16% of total revenue. It is unclear why the company did not name the customers. The revenue showed up in Nvidia's "Compute & Networking segment," the SEC filing showed."
Nvidia is investing capital into companies that will build data centers that will purchase Nvidia chips. A $100 billion investment in OpenAI and similar transactions raise concerns that Nvidia may be generating revenue from purchases it helped finance. Bloomberg characterized the OpenAI deal as a way to prop up market demand for Nvidia products. Nvidia disclosed two unnamed customers accounted for 23% and 16% of quarterly revenue in the Compute & Networking segment. The structure of these investments and purchases creates questions about whether reported sales reflect independent customer demand or revenue supported by Nvidia's own funding.
Read at 24/7 Wall St.
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