NVIDIA FACES SCRUTINY OVER CIRCULAR AI DEALS

Shah highlighted concerns about the structure underpinning current AI infrastructure investments. Circular deals—where companies buy back products or engage in reciprocal arrangements—have become prevalent as enterprises accelerate AI deployments. The analysis suggests these arrangements may inflate demand metrics and obscure genuine market adoption patterns. Shah noted that while Nvidia maintains dominance in AI chips, the sustainability of growth depends on converting speculative purchases into productive implementations. Counterpoint's assessment indicates that verification of actual AI chip utilization rates has become critical for investors assessing the sector's health. The research firm points to discrepancies between reported shipments and confirmed deployment data across major cloud providers and enterprises. The discussion underscores growing questions about whether the current AI infrastructure cycle reflects genuine customer demand or financial engineering between major technology players.