Nvidia invested $2B in CoreWeave after shares dropped 50%. Recent deals include $20B for Groq and $4.9B for Intel.

Deutsche Bank upgraded CoreWeave to $140 and suggested the AI honeymoon may be ending.

Investors rethink ‘hands off’ investing and decide to start making real money

Nvidia (NASDAQ:NVDA) just seems to keep the deals and partnerships coming. Undoubtedly, the GPU king has plenty of cash to spend and, perhaps most importantly, efficiencies to unlock as it opts to team up to tackle some of the world’s greatest challenges. At the end of the day, more "circular" dealmaking may be a growing concern for some, but to prevent overlapping efforts (and hefty spend), collaboration only makes sense.

Of course, excessive investments could elevate the risk of an eventual collapse (think a house of cards scenario) if the AI bubble burst scenario ends up playing out, perhaps due to a lack of monetization progress or something that’s not yet on the radars of the market. Indeed, sometimes, it’s the off-the-radar risks that can deliver the biggest hit.

In any case, Nvidia’s latest big deal saw Jensen Huang’s empire make a big $2 billion bet on CoreWeave (NASDAQ:CRWV) with a $2 billion stake.

This latest deal comes just weeks after Nvidia spent a poured a couple of billion on a range of other deals, including the $1 billion Eli Lilly (NYSE:LLY) co-innovation collab as well as a $4.9 billion bet on** Intel** (NASDAQ:INTC), and, of course, let’s not forget about the big Groq deal for assets and talent for $20 billion. Undoubtedly, Jensen Huang has been making some impressive, high-return bets across the AI industry in recent years.

Could he have done even better by taking bigger swings on earlier investments, such as Elon Musk’s xAI?

Most definitely. But the stakes and valuation have risen notably in the past couple of years. And if the so-called "AI honeymoon" is over or nearing its end, as Deutsche Bank believes, perhaps such investments might not be able to excite Nvidia investors as much as they give them pause. Either way, time will tell how all these bets fare.

On the plus side, I do think Huang and his team have an ear to the valuation.

Of late, we’ve witnessed some prices implode quite viciously. Could it be that there are bargains forming within the AI scene? And if there’s more pain ahead for the AI trade, should investors expect the pace of deal-making to pick up for Nvidia and other top players in the AI race?