Oracle and others lend another $38 billion, the "OpenAI Chain" data center circle has accumulated liabilities of $100 billion!
Surrounding the data center and computing power frenzy of OpenAI, partners have incurred hundreds of billions of dollars in debt, forming a debt network known as the "OpenAI Chain," which has accumulated nearly $100 billion, comparable to the total net debt of the six largest global companies; meanwhile, OpenAI has cleverly shifted risks, with almost no debt itself, driving a leap forward in the AI industry with extremely low burdens
To support OpenAI's grand blueprint, a vast ecosystem composed of its partners is funding the AI infrastructure construction frenzy through debt, while OpenAI itself cleverly places financial risks outside its balance sheet.
The latest development is that a new round of massive financing for OpenAI's infrastructure construction is brewing. According to sources familiar with the matter, a banking consortium is negotiating to finalize a new loan of up to $38 billion in the coming weeks, which will be used for new sites being built for OpenAI by Oracle and data center builder Vantage.
This new loan will become another heavy straw on this debt network. Analysts note that OpenAI's partners, including SoftBank, Oracle, and CoreWeave, have previously borrowed at least $30 billion to invest in OpenAI or help build its data centers. Additionally, investment groups like Blue Owl Capital and computing infrastructure company Crusoe also rely on agreements with OpenAI to repay approximately $28 billion in loans.
However, in this gamble, OpenAI's own balance sheet is remarkably "clean." According to individuals close to the company, OpenAI carries almost no debt, having only secured a $4 billion credit line last year that remains unused. Its strategic intent is very clear—an OpenAI senior executive candidly stated:
“How does OpenAI leverage others' balance sheets? This has always been our strategy.”
Total liabilities approaching $100 billion, partners bear financial risks
With the addition of the new $38 billion loan, the total debt surrounding OpenAI is approaching the $100 billion mark. This scale is comparable to the debt levels of the world's largest corporate borrowers. According to a report by asset management firm Janus Henderson in 2024, this figure is equivalent to the net debt of six of the world's largest corporate borrowers, including Volkswagen, Toyota, AT&T, and Comcast.
In fact, the actual debt related to OpenAI may be much higher. Many partners, including SoftBank and CoreWeave, have conducted larger-scale financing this year but have not explicitly linked it directly to OpenAI. For example, SoftBank raised about $20 billion for its AI investments this year, with OpenAI being its largest investment target to date.
Meanwhile, as the ultimate beneficiary of all this, OpenAI has successfully shifted the risks. This privately held company, which is currently valued at $500 billion, firmly believes that to achieve "Artificial General Intelligence" (AGI) that surpasses human capabilities, it needs more capital to support the construction of data centers, chips, and power.
Procurement commitments far exceed revenue, cleverly shifting financing pressure
OpenAI's ability to make its partners willingly bear massive debts stems from its nearly endless demand for computing power. This startup has signed agreements to procure $1.4 trillion worth of computing power over the next eight years, a figure that far exceeds its projected annual revenue of $20 billion this year For partners, these long-term and large-scale procurement contracts constitute the credit foundation for borrowing from banks. For OpenAI, this is an efficient expansion model. OpenAI stated:
"Building AI infrastructure is the most important thing we can do to meet the surging global demand... The current shortage of computing power is the single biggest factor limiting OpenAI's growth capacity."
Oracle has sold $18 billion in corporate bonds to fulfill its infrastructure commitments to OpenAI. Analysts at KeyBanc Capital Markets predict that the tech group led by Larry Ellison may need to borrow $100 billion over the next four years to fully deliver on its contracts with OpenAI.
SPV and Non-Recourse Loans: A Sophisticated Risk Isolation Mechanism
In this debt expansion, complex financial instruments play a key role in helping investors and developers isolate risks. Many data center loans are structured through special purpose vehicles (SPVs), which can protect the parent companies of investors and developers from impact in the event of default.
According to sources familiar with the negotiations, Vantage is preparing to use an SPV structure for loans for new sites to be built in Texas and Wisconsin. Previously, Blue Owl and Crusoe established a joint venture SPV to build OpenAI's first U.S. data center in Abilene, Texas, which received approximately $10 billion in loans from JP Morgan. This loan is non-recourse, meaning that if the lessee Oracle defaults, JP Morgan will take over the land and data center without recourse to Blue Owl or Crusoe.
Similarly, Blue Owl also utilized a wholly-owned SPV to borrow $18 billion from a consortium primarily composed of Japanese banks for the construction of another data center in New Mexico, which is also leased by Oracle for OpenAI. These sophisticated financing arrangements ensure that even if problems arise with the project, risks can be contained within specific projects, thereby encouraging a continuous influx of capital into the construction boom surrounding OpenAI
