The AI giants’ ploy to present their accounts
The AI giants have a problem of colossal proportions… nearly $300 billion! What is this money for? It is the total amount of accumulated losses, invested in developing the most expensive models. The Financial Times has revealed how these start-ups were going about making their balance sheets look more presentable, with some just a few months away from an IPO. The story therefore centres on around $300 billion in… exposure linked to data centres, chips and AI infrastructure, structured via guarantees, dedicated vehicles and other off-balance-sheet arrangements. The mechanism is by no means mysterious, but it is effective. Companies such as Meta, Nvidia, Broadcom, Alphabet, Amazon and Oracle can thus finance very costly infrastructure whilst preserving their financial flexibility and credit ratings. The risk, meanwhile, is shifted to commitments that…