Chipmaker Nvidia (NVDA) is investing $3 billion U.S. in Meta Platforms (META) as the two companies deepen their artificial intelligence (A.I.) partnership.
News of Nvidia’s investment comes after Meta announced plans to raise $95 billion U.S. to support its ongoing investments in A.I. infrastructure and related technologies.
Meta said it would initially raise $35 billion U.S. in underwritten public equity offerings, before raising an additional $60 billion U.S. with an at-the-market share sale.
As part of the investment deal, Meta Platforms has agreed to expand its use of Nvidia’s Vera Rubin microchips and processors.
“We’re excited to keep working with NVIDIA to deliver the best personal agents and frontier models for billions of people,” said Meta CEO Mark Zuckerberg in a news release.
Nvidia has been rapidly buying stakes in companies that are helping to power the A.I. boom, having previously invested in startup companies OpenAI and Anthropic, as well as Intel (INTC).
So far this year, Nvidia has participated in 121 investment rounds, up from 13 in 2022.
However, many analysts criticize Nvidia’s investments, saying it is providing the money for companies such as Meta to buy its microchips, an arrangement known as “circular financing.”
Nvidia has responded by saying that its investments are needed to help fuel the rapid growth and expansion of A.I. in the U.S. and abroad.
NVDA stock has risen 13% over the last 12 months to trade at $216 U.S. per share. META stock has declined 16% in the past year to change hands at $630.56 U.S.
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