Nvidia Is Buying Equity In Other AI Stocks, And It Can Be A Long-Term Catalyst

Many tech investors are building a diversified AI stock portfolio, and it turns out Nvidia (NASDAQ: NVDA) is joining them. The AI chipmaker isn't just the largest company in the industry (and indeed, in any industry) -- it's also taking equity positions in other tech companies. When those smaller companies outperform, it directly translates into a better balance sheet for Nvidia. Although these equity investments make up a small slice of Nvidia's balance sheet, it represents an underrated opportunity that most Nvidia investors don't have on their radars.

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Nvidia's deal with Iren is a good display of equity accumulation

Nvidia isn't just making money with AI chips. It wants to get more deeply involved in multiple components of the AI industry, including AI data center expansion. That motivated it to cultivate a close relationship with Iren (NASDAQ: IREN), an established AI data center provider.

Nvidia designs the high-end processors that Iren uses in its AI data centers to provide neocloud services. The companies reached a partnership that is intended to support the deployment of Nvidia chips across up to 5 gigawatts of Iren's AI data centers over time.

Iren has been buying Nvidia chips for several years, so their relationship isn't anything new. However, the attention-grabber in the press release announcing their most recent deal was that Nvidia got a five-year right to buy up to 30 million shares of Iren at $70 per share. That's a potential $2.1 billion investment, structured as a call option.

Iren is up by almost 600% over the past year and trades at around $57 per share. It's also up by more than 30% year to date. Assuming the AI infrastructure build-out continues to scale and demand increases, Iren could be trading well over $70 per share five years from now. That would result in a solid return for Nvidia and its shareholders.

Nvidia is building its stock portfolio

The deal with Iren is far from the only equity investment Nvidia has made. The AI chipmaker laid out $5 billion for a stake in Intel (NASDAQ: INTC) near the end of 2025, giving it full exposure to Intel's more than 200% gains year to date.

It bought its Intel stock at $23.28 per share in December. Now, it's above $110 per share. That return has outpaced Nvidia's recent revenue growth and year-to-date stock gains.

Intel showed up as the largest position on Nvidia's most recent 13F. CoreWeave, Synopsis, and Coherent are its next three top positions. Nvidia also invested $2 billion into AI data center provider Nebius' stock in March.

Nvidia has good relationships with all of these companies because they buy its chips. The tech giant knows more about the smaller AI companies than most investors and can negotiate good terms when building equity positions. Nvidia's investment efforts show that it's not sitting on its laurels after becoming the clear leader in the AI chip industry. Those equity investments have the potential to generate positive returns for Nvidia shareholders.

Marc Guberti has positions in Iren. The Motley Fool has positions in and recommends Intel, Nvidia, and Synopsys. The Motley Fool has a disclosure policy.