Five-month-old NVIDIA AI chip deal with UAE stalled, officials concerned

Five-month-old NVIDIA AI chip deal with UAE stalled, officials concerned

NVIDIA (NVDA) has been facing concerns over its five-month-old AI chip deal with the UAE, as officials from both sides express worries about the project's progress. The deal, announced in April 2025, aimed to establish a significant AI infrastructure in the UAE, but recent developments suggest a potential slowdown or even stall in the project.

The UAE, under the leadership of President Sheikh Mohammed bin Zayed Al Nahyan, has been investing heavily in AI technology to diversify its economy away from oil. The country's ambitious plans include building one of the world’s largest AI data centers and launching a new Arabic-language AI model . The deal with NVIDIA was seen as a crucial step towards achieving these goals.

However, recent discussions between NVIDIA and UAE officials have revealed concerns over the progress of the project. The meeting between Sam Altman, CEO of OpenAI, and President Sheikh Mohammed bin Zayed Al Nahyan in Abu Dhabi in May 2025 highlighted the need for real-world applications of AI in the UAE . The UAE officials have expressed a desire to see tangible results from the investments in data centers and research projects.

The delay in the project has raised questions about the feasibility and timeline of the deal. NVIDIA has been investing heavily in AI research and development, including a $100 billion investment in OpenAI . However, the company's equity stakes in CoreWeave, a firm providing data center capacity, have raised concerns about potential conflicts of interest and circular financing .

While NVIDIA remains committed to the project, the slowdown has prompted concerns about the company's ability to deliver on its promises. The UAE's AI ambitions are closely tied to its economic development plans, and any delay in the project could have significant implications for the country's long-term strategy.

The situation highlights the challenges faced by tech companies and governments in implementing large-scale AI projects. It also underscores the importance of clear communication, realistic timelines, and effective management in such complex ventures.