Amazon Plans to Spin Off $8 Billion Worth of Nvidia Chips
Set Trending Topics as a preferred source on Google.
Amazon is looking to spin off around $8 billion in advanced Nvidia chips to external investors. That’s according to the Financial Times, citing people familiar with the matter. The e-commerce giant has held talks with investors in recent weeks to gauge interest in the deal.
The company plans to carve out thousands of Grace Blackwell chips into a special purpose vehicle (SPV). Amazon will then lease back the advanced AI chips — deployed in data centers across the US — from that entity. The SPV is set to attract external investors through debt issuances.
Asset-Light Strategy for Balance Sheet Optimization
The move aims to strengthen Amazon’s balance sheet by offloading expensive chip costs onto investors. The company is pursuing an asset-light approach. Amazon also plans to offer an equity stake of up to 10 percent in the SPV, suggesting the group itself will not retain a share in the entity.
The step comes amid a broader trend among US hyperscalers to find less balance-sheet-heavy ways to finance their massive data center buildouts. A large share of data center costs falls on the advanced chips used to train artificial intelligence models.
Over $200 Billion in Capital Expenditures Planned
Amazon has announced it will make over $200 billion in capital expenditures this year. A large portion of that will flow into its web services cloud unit to purchase more chips and build additional data centers.
The carve-out strategy illustrates how tech giants are developing innovative financing models to manage the enormous capital requirements of AI infrastructure. Nvidia’s Grace Blackwell chips are among the most sought-after components for training large language models and other AI applications.
