Nvidia Is in the Data Center Business. 5 Companies That Will Benefit.

Vertiv and Nvidia are working together on power and cooling infrastructure for Nvidia Blackwell chips. (Business Wire)

Key Points

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• Nvidia will invest $100 billion in OpenAI and collaborate on designing AI data centers, termed “AI factories.”
• Nvidia’s strategy involves co-optimizing road maps with OpenAI to address power, cooling, and orchestration inefficiencies.
• Nvidia is partnering with firms like Jacobs, Schneider Electric, Vertiv, GE Vernova, and Siemens Energy on data center design.

Nvidia makes the chips that go into artificial-intelligence data centers. Now the company is getting more involved in figuring out what the data centers themselves will look like.

The $100 billion investment that Nvidia announced in OpenAI isn’t a passive investment—the chip maker is intent on helping OpenAI design its data centers, according to one source familiar with the company’s strategy. Nvidia has gotten directly involved in the data center side of its business before, making major investments in data center provider Coreweave.

In the OpenAI announcement, Nvidia said the companies would “co-optimize their road maps” for AI. In practice, that means Nvidia will work with OpenAI on how to design its so-called AI factories, which are each expected to use as much power as a small city. While OpenAI will choose the sites for its data centers, Nvidia will coordinate closely with OpenAI to figure out what they will look like, the source said. OpenAI didn’t respond to a request for comment.

Nvidia’s plans could boost several companies that the chip giant has already identified as partners in designing data centers, including engineering firm Jacobs Solutions, and industrial companies Schneider Electric , Vertiv , GE Vernova, and Siemens Energy .

Nvidia’s Vice President of Accelerated Computing Ian Buck unveiled its data center design plans at a conference earlier this month. In a blog post about Buck’s presentation, Nvidia said that data centers can no longer be “designed independently of the compute platforms they house, leading to inefficiencies in power distribution, cooling and system orchestration.” That’s why “Nvidia and its partners are flipping that model.”

If AI data centers continue to be built under current standards, they will quickly run out of space, electricity and water, according to Morten Wierod, CEO of Swiss industrial company ABB, which works on building electrical equipment for data centers. If the largest data center campuses are the size of 20 football fields today, eventually we could be talking about “how it will be 100 football fields,” he said. “Nobody wants that.” To accommodate higher power needs, ABB is working to step up the voltage at the data centers from around 48 volts to 800 volts.

Nvidia also thinks creating simulations can help. The company is using “digital twins” to design the optimal data center. Creating digital versions of the physical design allows the company to see what will work best in the real world.

Nvidia says it is relying on engineering firm Jacobs to guide the process, while companies including Schneider Electric, Vertiv, GE Vernova, Siemens, and spinoff Siemens Energy work on the electricity infrastructure and cooling.

If Nvidia’s design becomes an industry standard, those companies should benefit handsomely.

Write to Avi Salzman at avi.salzman@barrons.com