Jensen Huang says Nvidia is withdrawing from OpenAI and Anthropic, but his explanation raises more questions than it answers.

At the Morgan Stanley Technology, Media and Telecom conference in San Francisco on Wednesday, Nvidia CEO Jensen Huang said his company’s recent investments in OpenAI and Anthropic may be the last of the two, adding that if they go public as expected later this year, the investment opportunity closes.

It could be that simple. While firms sometimes pile into companies right up until the day before their public offering to demand more, Nvidia makes money selling the chips that power both companies — it’s not like it needs to recoup its profits by pouring more money into either.

Nvidia, on the other hand, doesn’t provide many details. Asked for comment today following Huang’s comments, a spokesperson pointed TechCrunch to a transcript from the company’s fourth-quarter earnings call, where Huang said all of Nvidia’s investments are “focused on expanding and deepening the reach of our ecosystem,” a goal its former stakes in both companies are responsible for.

However, several other dynamics may explain the reversal, including the circular nature of these arrangements themselves, which have raised questions about a potential bubble. When Nvidia first announced that it would invest up to $100 billion in OpenAI last September, MIT Sloan professor Michael Cusumano bluntly described it to the Financial Times as “a kind of washout,” noting that “Nvidia is investing $100 billion in OpenAI stock, and OpenAI says they will buy $100 billion or more of Nvidia’s chips.”

That would explain why the commitment is down. Nvidia’s investment finalized last week as part of OpenAI’s $110 billion round came to $30 billion — well short of that earlier promise. If there is more to the story, Huang is not saying, as he dismissed suggestions of bad blood between the two companies as “nonsense.”

At the time, Nvidia’s relationship with Anthropic looked like it was on its own. Just two months after Nvidia announced a $10 billion investment in November, Anthropic CEO Dario Amodei took the stage in Davos and, without naming Nvidia directly, compared the actions of US chip companies selling high-performance AI processors to allowing Chinese customers to “sell nuclear weapons to North Korea.” (Wow.)

In retrospect, the nuclear weapons comparison had little to do with it. Days before Huang appeared at the banking conference, the Trump administration blacklisted Anthropic, barring federal agencies and military contractors from using its technology after the company refused to allow its models to be used for autonomous weapons or mass surveillance at home.

Within hours of that announcement, OpenAI reached its agreement with the Pentagon — a move Anthropic called “extraordinary” and the public seems to have viewed it the same way. Within 24 hours, Claude had shot to the top of the US App Store, overtaking ChatGPT. (At the end of January, Anthropic was out of 100, according to Sensor Tower data.)

Where that leaves Nvidia is involved in two companies that, at the moment, are pulling in very different directions, and may be pulling customers and partners along for the ride.

Whether Huang saw any of this coming, given Nvidia’s web of partnerships, is impossible to know. But the reason he said Wednesday that he might pull the plug on future investments — that the IPO window closes the door on this kind of deal — is that it’s hard to say how short-term private equity investing actually works. What seems more likely is that this is getting out of a situation that has become really difficult, very quickly.