Nscale raises $3.36B in pre-IPO convertible notes, Nvidia adds $1B forward

Third Point is leading a $3.36 billion pre-IPO convertible financing for Nscale, the British AI cloud operator said Friday — one of the largest AI-infrastructure raises of 2026, landing about a week after Nscale filed paperwork for a U.S. listing, with Nvidia committing another $1 billion for November.

The financing consists of an initial $2.36 billion tranche funded at closing and a $1 billion forward commitment from Nvidia, expected to fund in mid-November, the company said in a statement from London. The notes convert into ordinary shares — non-voting shares in Nvidia's case — automatically once the IPO is complete.

The investor list reads like a cross-section of the AI trade's biggest backers. New and existing investors include Nvidia, funds managed by Apollo, Citadel, Hudson Bay Capital, the Abu Dhabi Investment Council and 8090 Industries, with Davidson Kempner, QRT, Wellington Management, LionTree and others also participating. Goldman Sachs & Co. LLC acted as placement agent.

A structure built for the IPO

The auto-conversion clause is doing real work. Convertible notes that flip to equity on listing let a company lock in capital before bankers price the offering — useful for a capital-hungry business that needs to keep building while the deal is assembled. For Nscale, $2.36 billion hits the balance sheet now; for investors, the notes become equity at the moment of listing, with no second negotiation.

Nvidia's position is the telling part. The chipmaker is already an investor in Nscale, and the $1 billion forward makes it one of the largest single commitments in the round — arriving as non-voting equity once the notes convert. It is the latest example of Nvidia putting balance-sheet capital behind the cloud operators building demand for its chips.

The release did not disclose a coupon, conversion price or discount on the notes. The securities were sold without registration under the Securities Act of 1933, the standard boilerplate for private placements of this kind.

What the money builds

Nscale describes itself as a vertically integrated AI cloud — software, compute and power under one roof, from behind-the-meter power plants to liquid-cooled data centers and large-scale GPU clusters. Its customers include hyperscalers, frontier model labs, AI-native startups and enterprises building and scaling AI systems.

The eye-catcher in the announcement is the company's claim of more than $103 billion in total contracted value. That is Nscale's own number — contracted value measures signed future business, not recognized revenue — and investors will get a fuller picture once the IPO prospectus circulates. The company says the capital will accelerate its data-center buildouts globally.

"This marks a milestone for Nscale as we continue scaling our full-stack AI infrastructure to meet unprecedented global demand," said founder and chief executive Josh Payne. "With the backing of these world-class investors, we are strongly positioned to accelerate our data center buildouts globally."

The road to the NYSE

The raise comes about a week after Nscale filed its IPO paperwork, per TechCrunch. The Financial Times has reported the company is targeting a $35 billion valuation on the New York Stock Exchange, with Bloomberg reporting a $3 billion raise target for the offering — figures Nscale itself has not confirmed, and neither original story was independently verified here.

Nscale was spun out of Australian cryptocurrency miner Arkon Energy about two years ago, according to TechCrunch, and is developing large data-center campuses in Norway and West Virginia — a footprint spanning cheap-power jurisdictions on both sides of the Atlantic.

Taken together, the $3.36 billion round is a measure of the capital intensity now defining AI infrastructure: companies racing to build data centers are raising sums that would have been entire IPO sizes a decade ago, and the biggest backers are the chipmakers and funds with the most riding on the buildout continuing.