A look at OpenAI's tangled web of dealmaking

OpenAI CEO Sam Altman is everywhere.

His artificial intelligence startup, present valued astatine $500 billion, has been inking deals valued successful the tens to hundreds of billions of dollars with infrastructure partners, adjacent arsenic it continues to burn mounds of cash.

Those expenditures are driving the market.

The Nasdaq and S&P 500 roseate to record highs this week aft Nvidia agreed to put up to $100 billion successful OpenAI. That followed a $300 cardinal deal betwixt OpenAI and Oracle successful July arsenic portion of the the Stargate program, a $500 cardinal infrastructure task that's besides being funded by SoftBank.

Its commitments don't halt there. CoreWeave connected Thursday said it's agreed to supply OpenAI up to $22.4 billion successful AI infrastructure, an summation from the $11.9 billion it initially announced successful March. Earlier this month, chipmaker Broadcom said it had secured a caller $10 billion customer, and analysts were speedy to constituent to OpenAI. 

While OpenAI says that scaling is cardinal to driving innovation and aboriginal AI breakthroughs, investors and analysts are opening to rise their eyebrows implicit the mindboggling sums, arsenic good arsenic OpenAI's reliance connected an progressively interconnected web of infrastructure partners. 

OpenAI took a $350 cardinal involvement successful CoreWeave up of its IPO successful March, for instance. Nvidia formalized its fiscal involvement successful OpenAI by participating successful a $6.6 billion backing circular successful October. Oracle is spending astir $40 cardinal connected Nvidia chips to powerfulness 1 of OpenAI's Stargate information centers, according to a May study from the Financial Times. Earlier this month, CoreWeave disclosed an order worthy astatine slightest $6.3 cardinal from Nvidia. 

And done its $100 cardinal concern successful OpenAI, Nvidia volition get equity successful the startup and earn revenue astatine the aforesaid time.

OpenAI is lone expected to make $13 cardinal successful gross this year, according to the company's CFO Sarah Friar. She told CNBC that exertion booms necessitate bold bets connected infrastructure. 

"When the net was getting started, radical kept feeling like, 'Oh, we're over-building, there's excessively much,'" Friar said. "Look wherever we are today, right?"

Altman told CNBC successful August that he's consenting to tally the institution at a loss successful bid to prioritize maturation and its investments. 

But immoderate analysts are raising reddish flags, arguing that OpenAI's woody with Nvidia is reminiscent of vendor financing patterns that helped burst the dot-com bubble successful the aboriginal 2000s.

Nvidia has been the biggest victor of the AI roar truthful acold due to the fact that it produces the graphics processing units (GPUs) that are indispensable to bid models and tally ample AI workloads. Nvidia's concern successful OpenAI, which volition beryllium paid retired successful installments implicit respective years, volition assistance the startup physique retired information centers that are based astir its GPUs. 

"You don't person to beryllium a skeptic astir AI technology's committedness successful wide to spot this announcement arsenic a troubling awesome astir however self-referential the full abstraction has become," Bespoke Investment Group wrote successful a enactment to clients connected Tuesday. "If NVDA has to supply the superior that becomes its revenues successful bid to support growth, the full ecosystem whitethorn beryllium unsustainable." 

Peter Boockvar, main concern serviceman astatine One Point BFG Wealth Partners, said names of companies from the precocious 1990′s were ringing successful his ears aft the OpenAI-Nvidia woody was announced. 

A cardinal difference, however, is that this transaction is "so overmuch bigger successful presumption of dollars," helium wrote successful a note.

"For this full monolithic experimentation to enactment without causing ample losses, OpenAI and its peers present person got to make immense revenues and profits to wage for each the obligations they are signing up for and astatine the aforesaid clip supply a instrumentality to its investors," Boockvar said.

An OpenAI spokesperson referred CNBC to comments from Altman and Friar this week, adding that the institution is pursuing "a once-in-a-century accidental that demands ambition adjacent to the moment."

The full magnitude of request for compute could scope a staggering 200 gigawatts by 2030, according to Bain & Company's 2025 Technology Report. Building capable information centers to conscionable this anticipated request would outgo astir $500 cardinal a year, meaning AI companies would person to make a combined $2 trillion successful yearly gross to screen those costs.

Even if companies propulsion their full value down investing successful the unreality and information centers, "the magnitude would inactive autumn $800 cardinal abbreviated of the gross needed to money the afloat investment," Bain said.

There's a wide uphill conflict ahead, but OpenAI's Altman brushed disconnected concerns connected Tuesday, rejecting the thought that the infrastructure spending spree is overkill.

"This is what it takes to present AI," Altman told CNBC. "Unlike erstwhile technological revolutions oregon erstwhile versions of the internet, there's truthful overmuch infrastructure that's required, and this is simply a tiny illustration of it."

--CNBC's Yun Li and MacKenzie Sigalos contributed to this report

WATCH: OpenAI’s Sam Altman defends Stargate enlargement arsenic request for AI soars