Despite the initial announcement, the $100 billion potential deal between Nvidia Corp. (NASDAQ: NVDA) and OpenAI is yet to be finalized, the company’s CFO revealed on Tuesday.
Deal With OpenAI Still In Early Stage
At the UBS Global Technology and AI Conference in Scottsdale on Tuesday, Nvidia’s EVP and CFO, Colette Kress informed investors that the much-publicized partnership with OpenAI is still at the letter-of-intent stage, reported Fortune. Kress said that they still had not completed a “definitive agreement.”
Still, Kress stressed that Nvidia's relationship with OpenAI remains solid and added that the company's current sales forecast isn't tied to the new megadeal.
For now, OpenAI continues to buy compute through cloud partners like Microsoft (NASDAQ: MSFT) and Oracle (NYSE: ORCL) instead of using the new direct arrangement outlined in the letter of intent. Kress stated that OpenAI “does want to go direct,” but a definitive agreement is still being worked on.
OpenAI’s Competitive And Financial Struggle
The $100 billion potential deal between Nvidia and OpenAI has been a topic of interest and concern in the tech industry. The Jensen-Huang- led company had highlighted the uncertainty surrounding this deal in its latest financial earnings report. However, in the earnings call, Huang showed optimism and called OpenAI a "once in a generation company."
Meanwhile, commentator Jim Cramer has predicted that OpenAI’s future could be in jeopardy due to the recent advancements in AI technology, particularly Alphabet In c.’s (NASDAQ: GOOGL) (NASDAQ: GOOG)Google Gemini 3 AI model.
Later, Cramer elaborated on CNBC that, besides Google, OpenAI's main vulnerability is financial: unlike tech giants that can borrow cheaply, OpenAI is already deeply indebted. He said the fastest solution would be to settle the New York Times lawsuit to cut legal costs or have Microsoft boost its stake to strengthen the company's balance sheet.
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Nvidia Unfazed By Competition
At the same time, Nvidia’s dominance in the AI chip market has been under scrutiny. Alphabet has emerged as a strong competitor amid its focus on Tensor Processing Units (TPUs), with its shares outperforming Nvidia’s. Over the past month, Alphabet stock surged 11.23%, while Nvidia stock plunged 12.29%, as per data from Benzinga Pro.
Nvidia’s stock was up 0.86% on Tuesday, closing at $181.46.
However, when asked about the competitive dynamics, Kress says they were "Absolutely not” bothered by other chips. She stated that the focus is on supporting various model builders and enterprises with a full stack. According to Kress, Nvidia's strength lies not in any one chip but in its entire ecosystem, from hardware and CUDA to its expanding catalog of specialized software.