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Nvidia Said to Commit $3bn to Meta’s Share Offering

Nvidia will commit $3bn to Meta's new share offering, CNBC reports. It is part of the first $35bn slice of a $95bn plan to fund AI infrastructure, putting a leading chip supplier behind one of its biggest customers.

Nvidia (NASDAQ: NVDA), the AI chip maker, will commit $3bn to the share offering from Meta Platforms. According to CNBC, the money forms part of the first $35bn of a $95bn plan Meta announced on Monday to fund AI infrastructure.

Monday’s closes predate the report, so they do not reflect it. Nvidia ended Monday at $216.00, up 2.4%, while Meta closed at $630.56, down 1.9%. Nvidia is about 11% below its 52-week high of $243.37.

NVDA.US

Meta (NASDAQ: META) said on Monday that the first $35bn of the $95bn will be raised in stock. That splits into about $22.5bn of Class A common shares and about $12.5bn of mandatory convertible preferred stock, which is preferred stock that converts into common shares.

The Associated Press reported that Nvidia, AMD and Broadcom had indicated they may buy a combined $5bn of the offering. Those are indications rather than completed purchases.

Only $35bn of the $95bn has been broken down. The $3bn is about 0.06% of Nvidia’s market value of roughly $5.2tn, so the significance is less the size than the direction: a supplier is helping fund a customer’s AI spending, and Meta is turning to equity markets to pay for it.

Line chart of Nvidia and Meta shares rebased to 100, with Meta peaking in late September.
Nvidia and Meta shares, rebased to 100 at the weekly close of 27 July; weekly closes to 26 October. Source: market data

Meta is 13.3% higher since the weekly close of the 27th of July and Nvidia 7.6% higher, but Meta peaked in the week of the 21st of September. Since the weekly close of the 28th of September, Meta has fallen 13.4% and Nvidia 7.7%. Nvidia fell for three straight weeks before Monday’s rise.

Meta’s 52-week range is $520.26 to $779.82, leaving Monday’s close about 19% below the top. Alphabet and Microsoft report earnings tomorrow, with Amazon on Thursday, and Nvidia’s own results follow on the 17th of November.

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