Nvidia is in talks to back billions of dollars of debt for Nscale, a young AI cloud company, so Nscale can build a 460-megawatt data center in West Virginia that Anthropic plans to use. The Information reported the talks on Thursday, October 29, citing people with knowledge of them, and Reuters summarized the report the same day. Nothing has been signed, and the terms could still change, according to investingLive's account of the report.
Reuters said Nvidia, Nscale and Anthropic did not immediately respond to its requests for comment.
What Nvidia would guarantee
According to Reuters, the credit support would help pay for the power infrastructure and construction of Nscale's AI data center in West Virginia. Nvidia is already an investor in Nscale, which is based in the UK.
Phoebe Liu, the Information reporter behind the story, wrote on X that Nvidia is discussing "a different credit support structure" for the campus: "a residual value guarantee for the data center itself." In a residual value guarantee, the guarantor promises that an asset will be worth at least a set amount, which makes lenders more willing to lend against it.
Wall Street CN, citing The Information, adds more detail. It says the guarantee is expected to be more than $5 billion and covers the facility itself, not the lease or the chips. It says this would let Nscale finance construction at an investment-grade rating. If Nscale fails to make its construction payments, Wall Street CN says, Nvidia would step in, pay, take over the facility for a period and help arrange a resale or sublease. It says this differs from Nvidia's earlier, larger credit support deals, which usually covered a customer's data center leases or chip financing rather than power and construction costs. investingLive, by contrast, says the size of the credit support has not been disclosed.
The Anthropic connection
The site is part of Nscale's Monarch campus in West Virginia, and it would run Nvidia's Vera Rubin chips, investingLive reported. Reports differ on how the 460-megawatt building fits Anthropic's contracts:
- Reuters says Anthropic struck a deal in August to spend $45 billion renting compute from the West Virginia campus, and that Nscale is also in talks to sell about 460 megawatts of compute to Anthropic in another deal that could also be worth about $45 billion.
- investingLive says the capacity would come from a second building at the Monarch campus, under a deal Bloomberg reported earlier this month in which Anthropic was in late-stage talks to buy about $45 billion of capacity. It says filings tied to Nscale's planned listing show existing Anthropic commitments of close to $45 billion.
- Wall Street CN says Nscale's IPO filing discloses a $45 billion contract with Anthropic for the first 460-megawatt building at Monarch.
What all three agree on: Anthropic is the planned user, the contract value cited is about $45 billion, and the debt would pay to build the site.
A GPU services agreement between Anthropic and an Nscale unit, filed as an exhibit in September, shows why financing matters to the deal. It covers dedicated access to Nvidia Vera Rubin NVL72 rack systems, and it says the provider "will exercise its best efforts following the Effective Date to secure Qualifying Financing as soon as possible and in any event no later than by the Longstop Date." It also says Anthropic is entering into separate agreements for all four tranches at the site, at Nscale's request, to help those financing efforts.
Why this matters
Data centers for AI cost a lot to build before they earn anything. A guarantee from a large, cash-rich company can make that debt cheaper. investingLive notes that supporters say such guarantees lower borrowing costs for cloud builders and speed up capacity that customers have already committed to use.
The same structure raises questions. If the guarantee is signed, investingLive says, Nvidia would have three roles in one deal chain: chip supplier, equity investor in the cloud provider and backer of its debt. Sceptics, it says, argue this ties Nvidia's balance sheet to smaller, highly leveraged firms, and that some revenue may depend on financing Nvidia helps provide. It also notes that the structure has drawn criticism before: in September, Anthropic signed a $35 billion compute deal with Lambda, another Nvidia-backed cloud provider, and critics argued that Nvidia was effectively underwriting demand for its own chips. It adds that Nvidia's finance chief has said the company sees those arrangements differently.
Wall Street CN says Nvidia has provided about $170 billion in credit support and investments to date to new cloud providers and other large customers. Reuters says the report comes as Nvidia-backed CoreWeave and Firmus have been hit by concerns about the debt behind the AI build-out. On October 29, llms.blog covered how Microsoft capacity delays hit CoreWeave and Nebius stocks.
Nscale's IPO
Nscale filed publicly for a US initial public offering in September, targeting a valuation of about $30 billion, investingLive reported. It says Nscale recently closed a pre-IPO round of about $3.4 billion led by Third Point, with Nvidia among the investors. Backing from Nvidia on the construction debt could help that listing, investingLive says, though investors may ask how much of Nscale's revenue depends on financing from its own supplier.
Nscale's path to the West Virginia site has already shifted once. investingLive says Anthropic took over the site after Microsoft withdrew from a preliminary letter of intent it signed in March. Separately, llms.blog reported on October 18 that Microsoft exited Nscale's Essex data center deal in the UK.
Update (Nov 5, 2026): The Financial Times reported that Microsoft rejected an option to more than double its Nscale lease in Texas, according to a Reuters summary. Reuters could not verify the report. See our report on Microsoft's Texas decision for the details.
What to watch
The talks are not final. The things to check next are whether Nvidia signs, how large the guarantee is, and how Nvidia reports this kind of contingent exposure in its filings. For Anthropic, the question is timing: the compute only arrives once the building is financed and built.
Sources
- Reuters via StreetInsider: Nvidia in talks to give credit support for Nscale's deal with Anthropic, The Information reports
- investingLive: Nvidia in talks to guarantee Nscale debt tied to $45 billion Anthropic compute deal
- Wall Street CN (Chinese): Nvidia to guarantee Nscale construction financing
- Techmeme: The Information report and reporter posts
- Anthropic and Nscale GPU services agreement, exhibit 10.25
