NVIDIA, the Circle at Rest

Yesterday’s arithmetic sized what a placement returns once the wheel turns. This is the other state. NVIDIA’s forward book waits for machines to run and customers to pay, and the position at the top of it ends on a credit rating, by the terms of NVIDIA’s own filed document. One company has cleared that threshold recently enough to read. What it cost is on file, and what it bought is a maturity more than cash.

The Financial Times reported on September 8 that Morgan Stanley and Goldman Sachs have held talks with the rating agencies on behalf of Anthropic and OpenAI, seeking an investment grade rating soon after each company’s public listing. (1) Rating analysts told the paper that no decision is made, that both companies remain unprofitable, and that at least one agency places both deep in speculative grade.

The same report names the reason a supplier cares. NVIDIA’s $105bn of credit support for the Ohio campus terminates when the counterparty wins a satisfactory credit rating.

That clause is in NVIDIA’s own filed document, and it is the release condition on the instrument at the top of the book. (2) Yesterday we sized one placement at work. This is the same book standing still.

The money that is already out

A frame we published in August sorts the forms a supplier’s help takes into nine rungs. (3) Yesterday’s piece worked the seventh, an equity placement, and computed what a gigawatt of resulting purchases returns against the capital placed. (4)

Every rung has a second state. Capital goes out, and then it waits.

At July 26, 2026 NVIDIA carried a receivable of $63,059m against $38,466m at the fiscal year end, customer advances of $2,800m against $160m, marketable equity securities of $42,783m and non-marketable securities of $51,157m. (5) Alongside those sit $105,000m of residual value guaranties, $3,500m of land, power and shell guarantees classified as credit derivatives, $36,000m of AI cloud agreements, and $20,000m of data center leases signed with the expectation of reassigning them to third parties. (5)

How the $105bn ends

The August 17 current report sets out the guaranties in Items 1.01 and 2.03, filed rather than furnished. (2) They are residual value guaranties with SB Energy as lessor, covering leases for approximately 4.25 gigawatts of IT load at the PORTS Technology Campus in Pike County, Ohio, with an affiliate of OpenAI Group PBC as tenant, cumulatively capped at $105 billion, stepping up across nine phases with the first expected in fiscal 2029. NVIDIA may secure approximately 3.8 gigawatts more at its sole discretion.

The obligations end on the earliest of four events: the twentieth anniversary of lease commencement, termination by OpenAI, other customary events, and the counterparty achieving a satisfactory credit rating.

A residual value guaranty pays on a shortfall, so a trigger obliges NVIDIA to cover the difference between the guaranteed minimum value of a lease and what a replacement lease or a sale recovers. (2) The instrument therefore sits between two quantities. A rating ends it, and the agencies set that. A residual value decides what it costs if it is called.

NVIDIA’s own document prices the removal of the instrument at a rating, and three agencies decide when that arrives.

One credit standing, tested four ways

One quantity prices four separate arrangements, and each document sets its own test of it. (6)

NVIDIA extends payment terms on large multi-quarter agreements to certain investment grade customers, and days sales outstanding moved to 60 from a 51-day baseline. (5) The $105bn of guaranties terminates on a satisfactory credit rating. CoreWeave’s parent guarantee counts contracted revenue from an investment grade counterparty at 100 cents and from a non-investment grade counterparty at 75. And SpaceX’s March 2026 bridge loan bore interest at Term SOFR plus a margin from 0.75 to 1.75 percent, the grid set by the company’s debt rating. (7)

Four instruments on one chain, four tests of one credit standing, and no document written against another.

What it took to get one

One company has cleared the threshold recently enough to read, and the conditions are the useful part.

In March 2026 SpaceX borrowed $20,000m on an unsecured bridge whose margin grid was set by its own debt rating, and used it to retire xAI’s 12.5% senior secured notes. On June 18 Fitch published a BBB+ rating, with Baa1 from Moody’s and BBB from S&P. (8) (9) Days later SpaceX issued $25,000m of notes at a weighted average 5.855 percent over 11.7 years, repaid the bridge in full, and booked an $18 million loss on extinguishment. (7)

Fitch’s own scoring separates the company from its position. Positioning, sector and operational characteristics score at the single-A level, and financial flexibility with them. Profitability and financial structure score bb. Governance takes two notches for voting control concentrated in one person with no sunset and no removal mechanism, calibration adds one back, and the standalone profile arrives at bbb+. (9)

Then the conditions. Management targets a minimum cash balance of $25 billion and no shareholder distributions, and Fitch records both. The prospectus carries the dividend half in its own policy section; no filing carries the cash target, searched in full text at source on September 8, 2026. (9) Over $90bn of pro forma liquidity, which Fitch says supports the rating through a period of “deeply negative, but largely elective” free cash flow. And the assumption underneath both: Fitch expects the company to defer discretionary capital deployment if capital markets access were curtailed, and describes a material portion of the capital program as uncommitted and deferrable. (9)

An investment grade rating on a company spending far more than it earns rests on the proposition that the spending can be stopped.

Where the two readings meet

That proposition sits opposite the book at rest.

NVIDIA’s guaranties, its extended terms and the coverage we computed yesterday all assume counterparties keep buying. (4) The rating on the one counterparty that has been through the process assumes the buying is elective and can be deferred.

Two parties have written down opposite readings of the same spending. A supplier’s book requires the capital program to continue, and a rating agency’s case is built on its being deferrable, and each of those is in a document with a date on it. The counterparty on the $105bn has no rating case yet, which is what makes the one that exists the one to read.

The conditions above are the shape of what the two labs are being asked to produce. (1)

And what it bought

Twenty-five billion raised, twenty billion repaid. One dollar in five was new money, and fees and the extinguishment loss take it below that. The other four dollars bought a maturity: an eighteen-month bridge became notes averaging 11.7 years at a fixed rate, in place of a floating one whose margin moved with the rating itself. (7)

The coupon is the smallest of the available measures. The weighted average rate is 5.855 percent, and the effective rate at June 30, carrying issuance costs, is 6.030 percent. (7) The paper averages 1.62 percentage points over Treasuries against an average BB spread of 1.55 and an average BBB spread of 0.92. (10)

On the reported spreads, an investment grade label priced wider than the junk average. Bloomberg Opinion’s Nir Kaissar wrote that credit investors are pricing the debt “as if the rating label were fiction.” (10)

One quantity, two outcomes

Two things ride on a counterparty’s credit standing and they behave differently.

At the counterparty, a rating is expected to lower the cost of capital and widen the pool of lenders. In the case we work here, four dollars in five went to a longer maturity and the fifth was new money. One company clearing the threshold shows what that can look like rather than what it must.

At the supplier, the rating ends the instrument outright. The $105bn of guaranties comes off on a satisfactory credit rating by the terms of NVIDIA’s own document, and that release carries no condition about what the counterparty gained from being rated.

Five hundred billion, and no agreement yet

The heaviest figure in the structure stands behind an arrangement that has not been struck.

NVIDIA’s August press release described financing platforms with Apollo, BlackRock, Blackstone, Brookfield, Goldman Sachs and KKR to mobilize more than $500 billion of third-party capital. (11) The Form 10-Q gives a narrower account of it. Verbatim in substance: in August 2026 NVIDIA entered memorandums of understanding with several large capital providers to establish independent financing platforms designed to mobilize more than $500 billion of third-party capital over time, and these and other preliminary arrangements may not lead to definitive agreements. (5)

Three things the filing does that the release does not. It names the instrument as a memorandum of understanding. It names none of the six capital providers. And it states NVIDIA’s own participation in a single clause: at its option, NVIDIA may provide limited residual-value support for a portion of specific projects, subject to project-by-project evaluation.

Residual value support is the same instrument as the $105bn, and here it is optional, limited, partial and unquantified. What that support would cover, where it would sit and what would trigger it are settled by a definitive agreement that does not exist.

The rating one lab already has

SpaceX reports three segments. The third is an AI segment spanning the frontier model Grok, AI solutions for consumer and enterprise customers, X, and AI computational infrastructure. (7)

A frontier laboratory already sits inside an investment grade registrant, and it arrived there by consolidation. Fitch counts the terrestrial AI compute business among the drivers of the rating and records that it has no directly rated peer. (9) The segment does work in the credit rather than riding on it.

Google and Broadcom have extended tens of billions of credit support behind Anthropic’s use of their chips, and Oracle’s own standing came under pressure after a downgrade. (1) Each is a supplier holding an instrument a counterparty rating would change.

Where that leaves it

The circle at work turns when a counterparty buys. The circle at rest waits on three agencies, and each of the four instruments answers a rating action differently: the guaranty terminates, the payment terms extend, the advance formula moves from 75 cents to 100, and the margin grid steps down. The company in that case raised $25,000m and repaid $20,000m of principal with the accrued interest on top, against a cash target that reached an agency and no filing, and its paper trades wider than the junk average.

A credit standing is fungible when it is accepted wherever it is offered, and NVIDIA’s is being accepted in four instruments at once. What a newer rating will be accepted for is settled one instrument at a time, and three documents would sharpen the reading: the guaranty’s own definition of a satisfactory rating, the next company through the process, and the pricing data at source.

A rating action on OpenAI tests all three at once.

Analysis: Cape Fear Advisors.