Nvidia and OpenAI strike $152b AI infrastructure deal

Good morning. Here's what happened overnight and what you need to know today.

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1.

Compute muscle: Nvidia plans to invest up to USD100 billion ($151.6 billion) in OpenAI to build AI data centres powered by its chips, the companies said. The two have signed a letter of intent for a strategic partnership to deploy at least 10 gigawatts of Nvidia systems, with the first phase due online in the second half of 2026 using next-generation Vera Rubin systems. The deal deepens ties between two key players in the AI sector, as Nvidia chip demand grows and OpenAI’s ChatGPT reaches around 700 million weekly users. The investment complements OpenAI’s infrastructure work with Microsoft, Oracle, SoftBank and others on the USD500 billion Stargate project. Nvidia CEO Jensen Huang told CNBC the project equals 4 to 5 million GPUs, or about what Nvidia will ship this year and double last year’s output. He described the investment as a leap toward the next era of intelligence. (Capital Brief)(Joint release)(FT)(Bloomberg)

2.

Left out: Anthony Albanese was left off Donald Trump’s list of bilateral meetings at the UN General Assembly in New York, with White House Press Secretary Karoline Leavitt listing several bilateral meetings that did not include Australia. The US President will instead hold talks with leaders from the UN, Ukraine, Argentina, the European Union, among others. Both leaders will attend a reception for more than 100 world figures on Tuesday night, where an unofficial encounter may occur. Leavitt said Trump’s UN address would be “a major speech touting renewal of American strength” and how “globalist institutions have significantly decayed the world order”. She added Trump disagreed with Australia, France, the UK, Canada and Portugal recognising a Palestinian state. Albanese will defend the recognition in his own UN speech, saying “in recognising Palestine, Australia recognises the legitimate and long-held aspirations of the Palestinian people” for “a place they can call home”, likening this to the Jewish people’s hope for Israel. Israeli Prime Minister Benjamin Netanyahu has vowed “there will be no Palestinian state to the west of the Jordan River” and described recognition as “a huge reward to terrorism”. (White House)(Capital Brief)(ABC News)(The Australian)

3.

Lean and mean: ANZ rejected multiple funding requests from its teams working on ASIC compliance, in a move insiders warn could deepen a rupture between its risk functions and senior management. Internal funding documents from last month viewed by Capital Brief show ANZ management declined to fully fund seven concurrent ASIC remediation programs to the extent staff working on them desired, even as the bank worked to resolve its regulatory woes by agreeing to pay the largest fine ever imposed by ASIC. The teams in charge of the bank’s breach and events reporting, complaints, bonus interest failures and consumer remediation as well as hardship and deceased estates originally requested funding totalling $76.4 million to properly address the seven compliance issues, only to receive just $39.6 million. Other teams’ requests were also met with less funding than requested. A senior ANZ source said the lack of resourcing would heap pressure on the bank's operational teams at a crucial juncture. (Capital Brief)

4.

Rally continues: Wall Street pushed toward its 28th record of the year as Nvidia jumped 4% on fresh artificial intelligence optimism, helping extend a USD15 trillion rally since April. Oracle shares gained after the company was named to provide security and help oversee the re-creation of a US version of TikTok’s algorithm. It also promoted Clay Magouyrk and Mike Sicilia as co-chief executive officers. Gold climbed to a record as the crypto world got hit as positions worth USD1.5 billion were reportedly liquidated. The dollar snapped a three-day gain streak and bonds were steady. Argentine assets surged after US Treasury Secretary Scott Bessent pledged “all options for stabilisation” to President Javier Milei. Bessent said that the US Treasury’s support could include swap lines, direct currency purchases, and purchases of US dollar-denominated government debt from Treasury’s Exchange Stabilization Fund. Bonds rose by the most on record, stocks leapt as much as over 8% and the peso also gaining after heavy central bank intervention. Bessent later told CNBC the US is prepared for a “large, forceful intervention.” (Capital Brief)(Bessent X)(FT)(WSJ)(Bloomberg)

5.

Fit funding: Oura Health Oy, the Finnish maker of the Oura health and fitness ring, is raising USD875 million (1.33 billion) in a Series E round that values it at about USD10.9 billion, Bloomberg reported, citing unnamed sources. The round is expected to close by the end of the month and could exceed USD900 million. The funds will be used to scale production, invest in development and expand internationally, according to the report. CEO Tom Hale said in an interview that Oura has now sold 5.5 million rings, up from 2.5 million in June 2024, and is on track to generate more than USD1 billion in revenue in 2025, doubling its 2024 result. Sales are expected to exceed USD1.5 billion in 2026. Subscriptions now account for about 20% of revenue. The US military is Oura’s largest business customer, though it contributes a relatively small share of sales. Separately, Oura secured a USD250 million revolving credit line. (Capital Brief)(Bloomberg)

6.

Fat bet: Pfizer will acquire drug developer Metsera for up to USD7.3 billion ($11.1 billion) as it looks to regain ground in the booming obesity drug market after abandoning its own weight-loss pill. The deal offers USD47.50 per share in cash and up to USD22.50 tied to clinical and regulatory milestones and is expected to close by the end of 2025. It comes after Pfizer scrapped its lead obesity drug, danuglipron, in April after safety issues in trials. Metsera adds a portfolio of experimental therapies, including MET-233i, an analogue of appetite-regulating hormone amylin that showed 8.4% weight loss in 36 days in early testing. Pfizer said the acquisition aligns with its focus on high-impact opportunities and positions it in a market projected to reach USD150 billion by the early 2030s. Leerink Partners estimate Metsera’s pipeline could generate over USD5 billion in peak sales. (Capital Brief)(Media release)(Reuters)(WSJ)

7.

Non-proliferation: Russian President Vladimir Putin proposed to extend the New Strategic Arms Reduction Treaty (New START) by one year, according to Reuters, which would extend the cap on the number of nuclear weapons each side can hold if US President Donald Trump agrees. New START, which also limits the deployment of land- and submarine-based bombers that deliver the warheads, is set to expire in February 2026. Speaking to a Russian Security Council meeting on Monday, Putin told councillors that he is prepared to roll over the treaty by 12 months in the interests of global non-proliferation and encourage dialogue between Moscow and Washington. US-Russian relations have hit a low point, as Putin has ramped up attacks on Ukraine and Russian drones and jets continue to violate EU states’ airspace. Polish leader Donald Tusk on Monday said Poland would not hesitate to shoot down objects that violate its airspace. (Reuters)(Capital Brief)

8.

Stalled talks: South Korean President Lee Jae Myung told Reuters that the country’s economy could fall into a crisis rivalling its 1997 meltdown if the government accepts US demands in stalled trade talks without safeguards. The countries verbally agreed to a trade deal in July which would see the US lower Trump’s tariffs on South Korean goods in exchange for USD350 billion in investment in South Korea among other measures. Lee said that the deal is yet to be signed due to disputes about managing the investments. Lee said the trade and defence talks are overshadowing Lee’s trip to New York this week, where he will address the UN General Assembly. Lee also told Reuters that while South Koreans were angered by the “harsh” treatment of over 300 South Korean workers arrested at a Hyundai battery plant in Georgia earlier this month, he said the raid would not undermine the bilateral alliance. (Reuters)