Update: this article expands Geekiki's coverage of the Nvidia transition with new details of Nvidia circular financing reported by the Wall Street Journal. Read the previous article: Colette Kress challenged Huang's big deals before taking over Nvidia, Reuters says.
The Wall Street Journal revealed on November 13 why Nvidia built the circular financing scheme that interim CEO Colette Kress tried to rein in: according to the paper, Jensen Huang privately admitted that wafers and memory ordered from TSMC were coming "like an avalanche", because large cloud providers were shifting to their own chips and reducing their reliance on Nvidia's off-the-shelf parts.
Instead of letting the surplus flood the market and push prices down, the company funded AI startups and data center operators so they would keep buying its chips — effectively creating demand sustained by Nvidia's own balance sheet. The paper also reports that the company approached TSMC to scale back future chip orders.
The numbers behind the operation
The proposed guarantee for OpenAI's computing project, about 8 gigawatts valued at up to $250 billion, was cut by Kress to about 4.25 gigawatts, or up to $125 billion, according to the WSJ. Nvidia's total commitments and guarantees reached about $530 billion in the latest quarterly filing, up from $184 billion the previous quarter, according to SemiAnalysis' review of the company's Form 10-Q.
Nvidia shares ended the week down about 13%, losing roughly $573 billion in market value, the worst week since April 2025, according to The Apex Wire. Analyst Ed Zitron estimates that at least $200 billion worth of Nvidia AI GPUs sit idle in warehouses for lack of power capacity or immediate demand — an estimate, not a figure confirmed by the company.
What it means for GPU buyers
For gamers and PC builders, the report matters because it shakes the perception of scarcity that sustained years of high GPU and memory prices: part of demand may have been financed by the manufacturer itself. It is important to stress that the claims are journalistic reports, not findings of an investigation, and nothing disclosed so far shows Nvidia broke any rule.
Nvidia reports third-quarter fiscal 2027 results on November 17, the first earnings report since Huang's resignation, with Kress in charge as interim CEO. The market is watching for any signal of change in the company's investment strategy.
Image credit: Nvidia logo, via Wikimedia Commons (public domain, PD-textlogo).
Sources:
- Wccftech — Jensen Huang financed AI startups to absorb excess silicon (November 13, 2026, based on the Wall Street Journal)
- The Apex Wire — Nvidia funded startups to buy its own chips (November 14, 2026)
- RepoCharts — Report says Nvidia funded AI startups that then bought its GPUs (November 14, 2026)
- Geekiki — Colette Kress challenged Huang's big deals before taking over Nvidia, Reuters says
- Geekiki — Jensen Huang resigns as Nvidia CEO; Colette Kress takes over as interim CEO
This article was produced with the assistance of artificial intelligence, cross-checked against public posts and internet sources, and reviewed editorially. We recommend consulting the original sources to confirm the details.
By Muse
