Nvidia's $750 Billion Balancing Act: Why a Deal Blitz Hasn't Stopped the Stock Slide
Published on 07/29/2026 at 21:31 | Redaktion boerse-global.de
The disconnect between Nvidia's deal-making machine and its stock price is growing harder to ignore. While the chipmaker has been stacking up partnerships and financing commitments at a pace that would exhaust most companies, its shares have been sliding steadily — down roughly 16 percent from the May peak and off more than 8 percent over just the past seven trading sessions. The question hanging over the stock is whether the market is missing the forest for the trees, or whether it sees risks the company's press releases don't mention.
A Web of Commitments That Spans Billions
The centerpiece of the recent activity is a financing package of historic proportions. Nvidia is in talks to guarantee as much as $250 billion for a 10-gigawatt OpenAI data center in Ohio, a project being developed by SoftBank's Stargate unit with total costs estimated at over $500 billion. On top of that, a separate $350 billion financing package for OpenAI chip purchases is also being discussed, according to the Wall Street Journal. Combined with last week's announced partnership with SK Group — valued at more than $500 billion — the total volume of Nvidia's active deals now exceeds $750 billion. The OpenAI guarantee is not yet finalized and still requires regulatory approval.
The logic behind the structure is straightforward: Nvidia locks in years of reliable chip demand, while OpenAI reduces its dependence on any single cloud provider. But the risk falls squarely on Nvidia's shoulders if the data center's utilization falls short of expectations. Analysts have already begun drawing comparisons to the dot-com era, when equipment suppliers like Lucent and Nortel extended financing to their own customers — arrangements that later proved unsustainable.
Credit Markets Flash Warning Signs
The first signs of unease appeared not in the stock market but in the credit market. Nvidia's five-year credit default swaps posted their largest single-day increase on record after news of the financing talks broke. According to Reuters, the cost of insuring Nvidia's debt rose to roughly 78 basis points, while Oracle climbed to about 200 and Meta to 93 — all well above the investment-grade index of 53 basis points.
Should investors sell immediately? Or is it worth buying Nvidia?
Investor Michael Burry, who famously bet against the housing market before the 2008 crisis, has been vocal about the risks. Market data from July 29 shows he expanded his short positions against leading semiconductor stocks, including Nvidia and Micron. Burry has warned that Nvidia's "overreach" is driving circular spending into "biblical dimensions," pointing to additional risks in the private credit market where AI-related debt is increasingly held by insurers. The yield on ten-year US Treasuries currently sits at 4.68 percent.
The broader semiconductor sector felt the ripple effects. AMD lost roughly five percent on Monday, Micron dropped two percent, and SK Hynix fell seven percent. Singapore's MAS Director Chia Der Jiun has described the sustainability of the AI investment boom as one of the biggest uncertainties for financial stability, noting that AI companies now represent roughly 40 percent of S&P 500 market capitalization and about half of the US investment-grade bond market.
A Strategic Alliance That Adds Another Layer
Amid the credit market jitters, Nvidia confirmed a long-term strategic partnership with Safe Superintelligence Inc. on July 27. The company was co-founded by Ilya Sutskever, OpenAI's former chief scientist. Nvidia will supply the computing power for SSI's goal of developing safe AI systems at the highest level, and has invested $5 billion in the startup, giving it access to the Vera-Rubin platform.
The SSI deal follows closely on the heels of the July 24 agreement with SK Group to strengthen AI infrastructure and memory chip supply. Analysts view these alliances as critical for securing Nvidia's market position ahead of the next chip generation, Vera Rubin. The company is also expanding into Japan, increasing investments in local data centers to capitalize on the country's government-led AI initiatives. One analysis from July 29 suggests Nvidia may be undervalued by as much as 17 percent given that expansion.
Institutional Buyers Stay the Course
Not everyone is running for the exits. Cathie Wood's ARK Invest bought roughly 79,000 Nvidia shares on Tuesday, worth about $15.5 million, as part of a roughly $40 million shopping spree that also included Tesla and SpaceX. BofA analyst Vivek Arya reaffirmed his buy rating with a price target of $350. The analyst consensus sits at roughly $310, implying upside potential of about 57 percent, with some houses seeing room for more than a doubling.
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Operationally, Nvidia continues to deliver record numbers. First-quarter revenue rose 85 percent to $81.6 billion, with the data center segment alone contributing $75.2 billion. The company has guided for roughly $91 billion in second-quarter revenue. In the last fiscal year, the data center business generated $193.7 billion.
Chart Shows Strain but Not a Broken Trend
The technical picture reflects the tension. Nvidia's relative strength index sits at 39.9, approaching oversold territory, while the stock trades below its 50-day moving average of €179.66. The 200-day average, however, still offers a cushion of about 1.57 percent — suggesting the broader uptrend has not yet been broken despite the uncertainty surrounding the financing structure.
What Comes Next
The next major catalyst arrives on Wednesday, August 26, 2026, when Nvidia reports fiscal second-quarter results for 2027. Investors will be watching Blackwell chip shipment volumes, initial revenue contributions from the new Vera CPU line, and management's commentary on the sustainability of data center demand. The results land at a moment when the industry is gradually transitioning to the new Rubin platform, and when the market is still trying to decide whether Nvidia's deal-making represents strategic genius or overreach.
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