The AI Bubble in 2025: Interconnected Investments and NVIDIA as the Ultimate Winner

2025 has marked the peak of Artificial Intelligence euphoria. Trillions of dollars have poured into AI infrastructure, model training, and data centers. But the big question remains: is this a sustainable boom or a bubble ready to burst like the dot-com era in 2000? As of December 2025, the evidence points to a mix of genuine demand and excessive speculation, with NVIDIA emerging as the primary beneficiary.

OpenAI's Deep Dependence on NVIDIA Hardware

OpenAI, the creator of ChatGPT, relies heavily on NVIDIA GPUs to train and run its massive language models. NVIDIA’s flagship chips, such as the H100 and the Blackwell series (launched in late 2024 and ramping up production in 2025), provide the enormous parallel computing power required for models with trillions of parameters.

On September 22, 2025, OpenAI and NVIDIA announced a major strategic partnership: OpenAI committed to deploying at least 10 gigawatts of data center capacity powered by NVIDIA systems. This is equivalent to the electricity consumption of a major city (roughly 8–10 million U.S. households). The first gigawatt is planned to come online in the second half of 2026 using NVIDIA’s upcoming Vera Rubin platform.

This deal underscores a technical reality: training next-generation models like GPT-5 requires exaflops of compute power, which today can only be reliably delivered by NVIDIA’s ecosystem. OpenAI’s models are optimized for CUDA, NVIDIA’s proprietary software platform, creating a strong lock-in effect.

NVIDIA’s Investment in OpenAI: A Closed-Loop Funding Cycle

The most controversial aspect is NVIDIA’s commitment to invest up to $100 billion in OpenAI over time, tied to data center deployments. This is currently structured as a letter of intent (not a binding contract as of December 2025), with funds released progressively per gigawatt deployed.

In practice, much of this investment flows back to NVIDIA: OpenAI uses the capital to purchase millions of GPUs and systems from NVIDIA. Critics call this “circular financing” or vendor financing, where NVIDIA essentially funds its own customers so they can buy more NVIDIA products. This echoes tactics seen during the dot-com bubble that artificially inflated revenue.

NVIDIA’s CFO, Colette Kress, stated in December 2025 that no definitive contract exists yet, and current sales forecasts do not rely on this deal. Still, the partnership reinforces an already exceptionally strong relationship.

A Broader Web of Interconnected Investments

This pattern extends across the entire AI ecosystem:

• NVIDIA has invested in numerous AI startups, including Anthropic (up to $10 billion alongside Microsoft), xAI (Elon Musk’s company), CoreWeave (a cloud provider specializing in NVIDIA GPUs), and dozens more.
• Microsoft, OpenAI’s largest investor, has co-invested in competitors like Anthropic.
• In October 2025, OpenAI signed a deal with AMD for 6 gigawatts of capacity using AMD Instinct GPUs (MI300X and MI350X series), with OpenAI potentially gaining up to 10% equity in AMD through warrants.
• Amazon is in advanced negotiations (as of December 2025) to invest at least $10 billion in OpenAI, contingent on using Amazon’s Trainium chips, which briefly caused NVIDIA’s stock price to dip.

These deals create a tight network where capital circulates among a small group of players. Hyperscalers (Amazon, Microsoft, Google, Meta) are projected to spend over $300 billion on data center capex in 2025 alone, much of it for AI.

Is This Truly an AI Bubble? The Evidence

Concerns about a bubble are widespread:

• Valuations of AI startups have soared to irrational levels. Many early-stage companies raise billions with minimal revenue or profits. In Q1 2025, AI startups raised over $70 billion, often at multiples far exceeding fundamentals.
• Capex has reached record highs: hyperscalers and AI companies are building massive data centers, but AI-generated revenue has not yet scaled proportionally. If demand slows, underutilized capacity could lead to heavy debt burdens.
• Circular deals raise red flags: investments flow back as purchases, potentially inflating reported demand.

Optimists, however, argue that AI is genuinely transformative. The infrastructure buildout is necessary for future applications, and underlying fundamentals remain solid—enterprise adoption continues to accelerate.

NVIDIA: The Clear Winner and Bubble-Resistant Player

NVIDIA stands out as the classic “pick-and-shovel” provider in the AI gold rush. It supplies GPUs to everyone: OpenAI, Microsoft, Google, Amazon, Meta, and even competitors like AMD (via its software ecosystem).

As of December 2025, NVIDIA’s market cap is around $4.2 trillion, with revenue driven by insatiable AI demand. Blackwell shipments remain strong, and the Vera Rubin platform promises further gains in 2026. Even if circular deals falter, NVIDIA’s dominance in high-performance AI compute ensures resilience.

Conclusion: Proceed with Caution, But Stay Optimistic

2025 has shown that AI is not just a technology—it’s a massive financial and technological engine. Interconnected investments accelerate innovation but also introduce systemic risks such as overcapacity and dependency.

A bubble could burst if AI fails to deliver massive economic value or if competition (AMD, Amazon Trainium, Google TPUs) significantly erodes NVIDIA’s dominance. But one thing is certain: in this AI era, NVIDIA remains the ultimate winner—the company selling the shovels always profits most, no matter who strikes gold.

Proceed with caution, but the long-term potential remains immense.