Nvidia-Backed Lambda Inks $1 Billion Private Debt for Chip Deal

Lambda Inc., an AI cloud-computing provider backed by Nvidia Corp., has raised about $1 billion of private short-dated debt for computing chips tied to its collaboration with Microsoft Corp.

JPMorgan Chase & Co. arranged the transaction, and the debt was marketed to private placement investors, according to people with knowledge of the matter, who asked not to be identified because they aren’t authorized to speak publicly.

The debt will finance the purchase of Nvidia graphics processing units known as GPUs, which will be leased by Microsoft, they added.

A representative for JPMorgan declined to comment, while those for Lambda, Nvidia and Microsoft did not immediately respond to requests for comments.

Lambda reached an agreement with Microsoft last year to deploy AI infrastructure that would be powered by tens of thousands of Nvidia GPUs. The private debt deal follows a separate $926 million loan which wrapped up earlier this month to fund the purchase and installation of GPUs and other infrastructure.

Read More: AI Cloud Provider Lambda Sells Loan for Nvidia-Tied Chip Deal

Lambda is a “neocloud” company that rents access to computing chips and other AI infrastructure. Bloomberg reported earlier this week that the company is in talks to raise as much as $3 billion in a round that could tee it up to go public next year.

Wall Street banks and technology companies are tapping every corner of the capital markets to fund the buildout of AI, raising over $400 billion of debt globally in just 2026 alone, according to Bloomberg-compiled data.