Why Investors Shouldn’t Panic About Nvidia’s Commitments

Talk about a nervous market! Shares of Nvidia fell 5% on Monday on news of a $500 billion partnership the AI chip giant struck with South Korean conglomerate SK Group, along with a Wall Street Journal report that Nvidia was separately in talks to help OpenAI finance a $500 billion data center campus in Ohio. Investors should take a chill pill: Neither of these deals was actually news. Nor were they fully fleshed out.

For instance, Nvidia and SK have only signed letters of intent to formalize a partnership, they said on Friday. Letters of intent are not worth the paper they’re written on. Remember, Nvidia and OpenAI signed a letter of intent last September for what they called a “landmark strategic partnership,” only to abandon the idea a few months later.