Nvidia is in talks to guarantee a multibillion-dollar debt loan for AI cloud provider Nscale’s planned Anthropic data center in West Virginia, The Information reported Thursday. Bloomberg later corroborated this report. Anthropic has signed a $44.6 billion deal for the project’s first building alone, according to Nscale’s IPO filing. Essentially, chip makers are co-signing loans for their customers, a sign of how hard the AI industry is working to keep its ramp-up plans going at a time when investors are nervous about the amount of money they have to spend.
The proposed arrangement would help Nscale secure funding for electricity and construction costs for the West Virginia campus. Under the so-called residual value guarantee, NVIDIA will step in if Nscale defaults on construction payments, temporarily taking over the facility and helping find a buyer and new tenant, according to The Information.
Nvidia’s previous support for cloud providers has primarily focused on leasing and chip purchases, not construction.
The stakes are high for Nscale, which is aiming to go public at a valuation of up to $35 billion, despite growing concerns about its ability to execute ambitious data center projects.
Anthropic’s deal with Nscale covers the first 460-megawatt building at Nscale’s West Virginia campus, which will be powered by Nvidia’s next-generation Vera Rubin chips. The companies are also discussing a second contract worth about $45 billion for another building.
Nscale has struggled to get the project off the ground. The company had about 25,000 advanced AI chips in operation as of August, a fraction of the roughly 500,000 it plans to deploy. West Virginia’s campuses are facing problems themselves. On more than one occasion, runoff from construction sites has flooded nearby homes. After months of negotiations, the project won state certification in September.
Microsoft pulled out of a planned Nscale facility in the UK this month after grid power was postponed to the 2030s.
According to The Information, NVIDIA is a major financial supporter of the space, providing approximately $170 billion in investment and credit support to NeoCloud and large customers. This includes a $1 billion convertible loan pledged to Nscale in September.
Neocloud, which lends out AI computing power without a well-funded core business behind it, is under pressure from investors. Shares of CoreWeave, Nebius, and IREN each fell more than 30% in October as of last week, as reported by CNBC.
The proposed guarantee would strengthen Nvidia’s financial relationship with Nscale and help it secure key customers for its chips. Anthropic, one of the largest buyers of AI computing power, spreads its infrastructure spending across multiple chipmakers. An investor told The Information that Anthropic’s involvement likely explains NVIDIA’s interest in getting Nscale’s project off the ground.
The discussion comes as Anthropic faces questions about how it will finance its rapid expansion. The company filed to go public this week, but Blackstone warned investors that Anthropic could receive a below-investment-grade credit rating after the IPO. A junk rating could raise Anthropic’s borrowing costs and keep it relying on stronger partners to back its debt.
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