OpenAI's $110 Billion Megadeal: Amazon, Nvidia, and SoftBank Place Their Bets on the AI Future

 

# OpenAI's $110 Billion Megadeal: Amazon, Nvidia, and SoftBank Place Their Bets on the AI Future

**Published: February 28, 2026**

You know that feeling when a handful of the biggest companies on earth decide that one single startup is worth betting a combined $110 billion on?

That's exactly what just happened with OpenAI.

The ChatGPT maker announced Friday that it has closed the largest funding round in history—a staggering **$110 billion** at a **$730 billion pre-money valuation** . Leading the charge is Amazon with a $50 billion commitment, followed by Nvidia and SoftBank, each putting up $30 billion .

This isn't just another venture capital round. It's a tectonic shift in the AI landscape. Amazon, once content to back OpenAI rival Anthropic, is now throwing its full weight behind the ChatGPT maker. Nvidia, the chip giant that's already selling every AI accelerator it can make, is doubling down as both a supplier and an investor. And SoftBank, the Japanese tech investing behemoth, is placing its biggest bet yet on the future of artificial intelligence.

Let me walk you through what this deal actually means, why these companies are writing checks of this magnitude, and what it tells us about where AI is headed.

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## The Short Version

**What happened:** OpenAI finalized a $110 billion funding round at a $730 billion pre-money valuation (about $840 billion post-money) .

**Who invested:**

- **Amazon:** $50 billion (by far the largest single investment)

- **Nvidia:** $30 billion

- **SoftBank:** $30 billion

**The structure:** Amazon's $50 billion comes in two parts—$15 billion upfront, with another $35 billion contingent on OpenAI hitting specific milestones, including a potential IPO or achieving artificial general intelligence (AGI) .

**What OpenAI gets:** A massive infusion of cash and computing power to fund its ambitious infrastructure plans, which include spending more than $1.4 trillion on AI development .

**What investors get:** Strategic partnerships that lock in OpenAI as a customer for their chips, cloud services, and more. Amazon will become OpenAI's exclusive third-party cloud provider, and Nvidia will supply 5 gigawatts worth of Vera Rubin hardware .

**What about Microsoft?** The companies issued a joint statement saying "nothing about today's announcements in any way changes the terms" of their existing partnership .

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## The Deal by the Numbers

Let's put this in perspective. $110 billion is an almost incomprehensible amount of money.

**Table 1: OpenAI Funding Round Breakdown**

| **Investor** | **Investment** | **Notes** |

| :--- | :--- | :--- |

| Amazon | $50 billion | $15B upfront + $35B conditional on milestones (IPO or AGI)  |

| Nvidia | $30 billion | Plus expanded partnership for next-gen inference compute |

| SoftBank | $30 billion | Largest single bet on OpenAI from the Japanese giant |

| Additional investors | ~$10 billion expected | Venture capital firms and sovereign wealth funds to join by March  |

| **Total** | **~$120 billion** (when fully subscribed) | |

*Sources: *

**The valuation math:**

- Pre-money valuation: **$730 billion**

- Post-money valuation: **~$840 billion**

- Previous valuation (October 2025): **$500 billion**

For context, that makes OpenAI one of the most valuable private companies in the world, alongside SpaceX and ByteDance (TikTok's parent) . It's now worth more than major public companies like Coca-Cola, Bank of America, or Intel.

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## Amazon's Pivot: From Anthropic to OpenAI

The biggest story here is Amazon. The e-commerce and cloud giant has been a longtime backer of OpenAI rival Anthropic, investing billions in that company over the past two years. Now they're making an even bigger bet on the competition.

### The Investment Structure

Amazon's $50 billion commitment is structured in two tranches :

- **Initial $15 billion:** Immediate cash infusion

- **Conditional $35 billion:** Will be invested when OpenAI either:

  1. Moves forward with an initial public offering, or

  2. Declares it has achieved artificial general intelligence (AGI)

This milestone-based approach gives Amazon some protection while keeping OpenAI incentivized to reach major corporate goals.

### The Cloud Deal

Beyond the equity investment, this is a massive commercial agreement:

- OpenAI will spend an additional **$100 billion on Amazon Web Services over the next eight years**

- This expands on a previous $38 billion multi-year deal announced in November

- AWS will serve as the **exclusive third-party cloud distribution provider for OpenAI Frontier**

**Andy Jassy**, Amazon's CEO, said the deal "will yield a good return for Amazon over a long period of time" .

### The Strategic Partnership

The two companies will jointly develop a **Stateful Runtime Environment** powered by OpenAI's models, which will be available through Amazon Bedrock . Amazon's own engineering teams will get access to customized OpenAI models to power customer-facing applications .

This is significant because it means Amazon is essentially adopting OpenAI as a core technology partner for its internal AI efforts—a major shift from building everything in-house.

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## Nvidia: Supplying the Brains

For Nvidia, this investment is as much about locking in a customer as it is about financial return.

### The Hardware Commitment

As part of the deal, OpenAI plans to deploy **5 gigawatts worth of Nvidia's Vera Rubin hardware** for training and running its models . To put that in perspective, one gigawatt is roughly the output of a nuclear power plant. This is an enormous amount of computing power.

### The Circular Economy

Nvidia is in a unique position. They're selling every AI chip they can make to companies like OpenAI, while simultaneously investing in those same companies. It's a classic "picks and shovels" play—if AI succeeds, Nvidia wins whether the specific model makers succeed or fail.

**The regulatory filing note:** Just before the OpenAI announcement, Nvidia disclosed in a filing that it was "finalizing an investment and partnership agreement with OpenAI" and cautioned that "there is no assurance that we will enter into an investment and partnership agreement with OpenAI or that a transaction will be completed" . That uncertainty is now resolved.

---

## SoftBank: Masayoshi Son's Biggest Bet Yet

SoftBank's $30 billion investment continues Masayoshi Son's decades-long pattern of making enormous, visionary bets on technology's future. From Alibaba to ARM to the Vision Fund, Son has consistently placed big money on transformative companies.

This is SoftBank's largest single investment in OpenAI, and it signals that Son sees AI as the defining technology of the next decade—worth betting tens of billions on.

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## What About Microsoft? The Original Partner

If you're following this closely, you might be wondering: what happened to Microsoft?

Microsoft has been OpenAI's primary partner since 2019, investing billions and providing the exclusive cloud infrastructure for the company's models. This new deal with Amazon might seem like a betrayal.

**The official line:** OpenAI and Microsoft issued a joint statement Friday: "Nothing about today's announcements in any way changes the terms of the Microsoft and OpenAI relationship. The partnership remains strong and central" .

**What that means in practice:** Microsoft remains a key partner, but exclusivity is clearly over. OpenAI is now free to work with multiple cloud providers and chip suppliers—which is exactly what a company at this scale needs to do.

**Sam Altman** downplayed the shift, telling CNBC: "Amazon can deliver so much to us in terms of new demand and opportunities in the market" .

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## The Circular Funding Concern: Is This Sustainable?

Here's the part that makes some investors nervous.

This funding round is the latest and largest example of what analysts call "circular financing" . The dynamic works like this:

1. Chip companies (Nvidia) and cloud providers (Amazon, Microsoft) invest billions in AI startups

2. Those startups turn around and spend that money on chips and cloud services from the same investors

3. Everyone's revenue grows, but the underlying economics can get murky

**The risk:** If demand for AI fails to match today's lofty expectations, these circular deals could magnify losses. Everyone is betting on each other, and if the whole ecosystem wobbles, there's no one to catch the fall.

**Sam Altman's response:** "I get where the concern comes from. This only makes sense if new revenue flows into the whole AI ecosystem" . He argues that his primary focus is getting more computing capacity to serve the exploding demand for ChatGPT and other products .

**The numbers behind the concern:** OpenAI pulled in about **$13 billion in revenue in 2025** , but expects to spend **$115 billion over the next four years** . The company is still unprofitable and doesn't expect to generate positive cash flow until 2030 . Gross margins have actually slipped to 33% in 2025 .

That's a lot of spending for a company that's still losing money.

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## OpenAI by the Numbers: Growth at Any Cost?

So what is OpenAI getting for all this money?

**Table 2: OpenAI Key Metrics (as of February 2026)**

| **Metric** | **Value** |

| :--- | :--- |

| Weekly active users | 900 million+ |

| Consumer subscribers | 50 million+ |

| 2025 revenue | ~$13 billion |

| Projected 4-year spending | $115 billion |

| Cash flow positive target | 2030 |

| Codex (programming product) users | 1.5 million+ weekly actives |

*Sources: *

**The growth story:** ChatGPT has more than **900 million weekly active users** , up from 800 million in October . Consumer subscribers have topped **50 million** . The programming tool Codex has more than **1.5 million weekly active users** , directly competing with Anthropic's Claude Code .

**The spending story:** OpenAI previously told investors it plans to spend about **$600 billion on infrastructure by 2030** —down from an earlier $1.4 trillion estimate, but still an astronomical sum . The company expects 2030 revenue to exceed **$280 billion** , with consumer and enterprise business roughly split .

**The competitive pressure:** OpenAI faces intense competition from Google's Gemini, Anthropic's Claude, and a host of open-source models. Last December, the company declared itself in "red alert" mode after ChatGPT's growth temporarily slowed . Growth has since recovered, but the threat is real.

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## What This Means for Different People

### If You're an AI Investor

This round validates the stratospheric valuations in AI. If OpenAI is worth $840 billion, then every AI startup just got a valuation boost. But it also signals that the "winner take most" dynamic is accelerating—the biggest players are getting truly enormous checks, while everyone else fights over scraps.

### If You're a Tech Worker

OpenAI's hiring spree is just beginning. With $110 billion in fresh capital, they'll be recruiting aggressively for AI researchers, engineers, and product talent. That's good for salaries and options across the industry.

But it also means competition is intensifying. If you're not working on AI-relevant skills, you're falling behind.

### If You're an Amazon, Nvidia, or SoftBank Shareholder

You're making a bet on AI through these companies. Amazon's $50 billion investment is by far the largest it's ever made in a single company . That's a bet that AI will reshape everything—and that OpenAI will be at the center of that transformation.

Nvidia's investment locks in a massive customer for its next-generation chips. SoftBank is placing its biggest bet yet on the AI future.

### If You're Just Curious About AI

This deal tells you that the biggest companies in the world believe AI is not a bubble—it's the future. They're putting real money (hundreds of billions of dollars) behind that belief. The technology you're using today is just the beginning.

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## Frequently Asked Questions

**Q: How much did OpenAI raise?**

A: OpenAI raised $110 billion in new funding, with Amazon ($50 billion), Nvidia ($30 billion), and SoftBank ($30 billion) as the lead investors. Additional investors are expected to join by the end of March .

**Q: What is OpenAI now worth?**

A: The pre-money valuation was $730 billion. Including the new funding, the post-money valuation is approximately $840 billion .

**Q: Is Amazon abandoning Anthropic?**

A: Not necessarily. Amazon remains an investor in Anthropic, but this OpenAI investment signals a major strategic shift. Amazon is now backing both leading AI labs .

**Q: What happens to Microsoft's partnership?**

A: Microsoft and OpenAI issued a joint statement saying their relationship remains "strong and central." But exclusivity is clearly over .

**Q: Why is Nvidia investing in its own customer?**

A: It's a classic "picks and shovels" strategy. Nvidia benefits whether OpenAI succeeds or fails—they're selling the hardware regardless. The investment just deepens the relationship .

**Q: When will OpenAI go public?**

A: Sam Altman said the company is "open to going public at the right time," noting advantages to both private and public structures . The conditional portion of Amazon's investment is tied to an IPO or AGI achievement.

**Q: Is OpenAI profitable?**

A: No. The company lost money in 2025 and doesn't expect to be cash flow positive until 2030 . Revenue was about $13 billion last year.

**Q: What is AGI, and why does it matter for Amazon's investment?**

A: AGI (artificial general intelligence) refers to AI systems that can perform any intellectual task that a human can. It's a loosely defined milestone, but Amazon's additional $35 billion investment is contingent on OpenAI either achieving AGI or going public .

**Q: How does this affect ChatGPT users?**

A: In the short term, probably not much. In the long term, this funding should enable OpenAI to scale its infrastructure, improve its models, and develop new products.

**Q: Are there any regulatory concerns?**

A: This deal will almost certainly attract regulatory scrutiny. It concentrates enormous power in a handful of companies and involves circular investments that could raise antitrust concerns.

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## The Bottom Line

Here's what I keep coming back to.

$110 billion is not a normal amount of money. It's not even a normal "huge" amount of money. It's more than the entire market cap of some Fortune 500 companies. And it's going to one startup that didn't exist as a commercial entity a few years ago.

**Sam Altman** put it in perspective: "We are entering a new phase where frontier AI moves from research into daily use at global scale. Leadership will be defined by who can scale infrastructure fast enough to meet demand, and turn that capacity into products people rely on" .

This funding round is about exactly that: scale. OpenAI needs computing power—staggering amounts of it—to train and run the next generation of models. They're spending more than $1.4 trillion on infrastructure . They need partners who can supply chips (Nvidia), cloud capacity (Amazon, Microsoft), and capital (SoftBank).

**The circular funding concern** is real. These deals create interlocking dependencies that can amplify both success and failure. If AI demand keeps growing, everyone wins. If it falters, the losses cascade.

But for now, the bet is clear: the biggest companies in technology are placing enormous wagers that AI is the future. OpenAI is their chosen vehicle for a large part of that bet.

The era of AI as a research project is over. We're now in the era of AI as industrial-scale infrastructure, funded by the largest corporations on earth.

And it's just getting started.