Nvidia (NVDA) stock jumped more than 4% Wednesday to help lead the tech sector and some chip stocks higher following Trump’s announcement of a massive, $500 billion AI infrastructure project.
The project creates a company called Stargate, which will be initially funded by SoftBank (SFTBY), OpenAI, Oracle (ORCL), and UAE-based MGX.
Stargate named Nvidia, along with Microsoft (MSFT) and British chip designer Arm (ARM), as “key initial technology partners” for the project, which aims to build out US data centers required to power artificial intelligence. OpenAI said Stargate would “begin deploying $100 billion immediately” and invest up to $500 billion over the next four years.
Nvidia’s gain Wednesday pushed its market cap to $3.6 trillion, making it the world’s largest company once again of Apple’s (AAPL).
Meanwhile, Microsoft shares rose nearly 4% early Wednesday, while Arm surged more than 14%. Oracle stock was up 7%, and SoftBank jumped more than 10%.
“Stargate will be building the physical and virtual infrastructure to power the next generation of advancements in AI, and this will include the construction of colossal data centers, very, very massive structures,” Trump said in a briefing Tuesday. “These buildings, these are big, beautiful buildings are going to employ a lot of people.”
Trump said the effort is meant to maintain the US lead ahead in developing artificial intelligence ahead of China.
The announcement follows a a slew of executive orders from the Biden administration on artificial intelligence last week aimed at restricting the flow of AI chips to China and speeding up the construction of data centers in the US.
“This comes at a critical juncture as we expect Trump to aggressively court more AI investments in the US,” wrote Wedbush analyst Dan Ives in a note to investors late Tuesday. Ives noted that the project is “all part of a broader game of high stakes poker with China.”
After the announcement, Elon Musk took aim at OpenAI on his social media platform X. Responding to a post from OpenAI about Stargate, he wrote “They don’t actually have the money.”
OpenAI estimated that it lost $5 billion in 2024, but generated just $3.7 billion in revenue.
Tech stocks across the board rallied on the news of the major AI investment. Dell (DELL) and Super Micro Computer (SMCI), which make servers using Nvidia chips, rose around 4%.
Laura Bratton is a reporter for Yahoo Finance. Follow her on Bluesky @laurabratton.bsky.social. Email her at laura.bratton@yahooinc.com.
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