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Nvidia's Third-Party Financing Deal Seen Extending AI Buildout, BofA Says

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Nvidia's (NVDA) new financing partnerships could extend the runway for artificial intelligence infrastructure buildout by providing additional capital for compute, power and data centers, BofA Securities said in a Tuesday note.

The company's new partnerships with Apollo (APO), BlackRock (BLK), Blackstone (BX), Brookfield (BN), Goldman Sachs (GS) and KKR (KKR) could mobilize $500 billion of third-party capital through independent financing platforms.

The new structure marks a pivot from vendor financing, with the burden now sitting with the consortium rather than Nvidia's balance sheet, BofA analysts said.

BofA also said the company's GPUs support the financing model because their fungibility and transferability across operators help maintain residual and rental values.

The firm noted Nvidia's Compute Unified Device Architecture extends the useful life of GPUs, while Nvidia underwrites asset quality rather than debt.

BofA maintained its buy rating on Nvidia and a $350 price target.

Price: $219.65, Change: $+2.10, Percent Change: +0.97%

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