Nvidia to Pay $1.5 Billion to Rent Back Its Own Chips From Cloud Startup

A small cloud provider for artificial intelligence that’s preparing to go public has secured a major boost from its most important supplier: Nvidia.

The chip giant agreed this summer to rent 10,000 of its own AI chips from the cloud firm, Lambda, for $1.3 billion over four years, and a separate $200 million deal to rent 8,000 more Nvidia chips over an unspecified time frame, according to a person with direct knowledge of the deals. The contracts position Nvidia as Lambda’s biggest customer ahead of the firm’s planned initial public offering.