Deep dive on Nvidia circular funding (philippeoger.com)

NVIDIA's recent Q3 Fiscal 2026 earnings report revealed a 62% revenue surge, largely attributed to its dominating AI data center segment. However, deeper analysis by industry observers indicates potential vulnerabilities within this impressive facade, including a notable cash flow gap and ballooning inventory, raising concerns about NVIDIA's long-term fiscal stability. Furthermore, the dynamics between NVIDIA, OpenAI, and Oracle suggest a complex and possibly fragile alliance, where OpenAI seems to be diversifying its hardware sources to lessen dependency on NVIDIA, evidenced by its parallel infrastructure project with Oracle, dubbed "Project Stargate." Notable developments include OpenAI's procurement of DRAM directly from suppliers and potential future chip innovations, possibly hinting at a strategic pivot away from relying solely on NVIDIA's GPUs. Analysts warn of "circular financing" behavior, where investments and contracts within this triad may lead to inflated revenue figures that could attract regulatory scrutiny. Meanwhile, Oracle's interest in acquiring startup Groq, which offers faster and cheaper chip solutions, highlights the escalating competitive landscape in AI hardware. This acquisition could provide Oracle and OpenAI an edge in the marketplace while reducing reliance on NVIDIA's expensive chips, further complicating NVIDIA's position in a rapidly evolving AI ecosystem.