The Great AI Circle

Four firms now define the operational and financial core of the AI economy: Nvidia, AMD, Microsoft, and OpenAI.

Their cross-linked capital flows and supply dependencies have created a closed system in which demand, valuation, and narrative reinforce one another. What appears as organic growth may instead reflect a self-referential feedback loop reminiscent of past cycles where intra-industry financing inflated apparent demand.

Hardware and Compute Dependency
Nvidia’s revenue engine depends on OpenAI’s insatiable appetite for compute. OpenAI’s credibility, in turn, hinges on access to that hardware. AMD’s positioning as a challenger does not diversify risk. It legitimizes the same premise… that AI demand is effectively infinite. Microsoft completes the circuit, converting GPU consumption into Azure revenue and marking AI as the new driver of cloud growth.

Recent Transactions Intensifying the Cycle