Six-year-old Nvidia Corp. (NASDAQ: NVDA) A100 chips retain a residual value of nearly $5,000 each, challenging investor Michael Burry's assertion that Big Tech firms are overstating profits by depreciating AI hardware over extended periods.

Silicon Data estimates the A100's residual value at $4,956, a figure that has remained roughly flat near $5,000 since late 2025. This stability arises because rising rental income offsets the typical decline associated with aging hardware. The estimate reflects the GPU's worth based on future rental income, factoring in utilization and operating costs, rather than second-hand sale prices.

Why Old Nvidia Chips Still Pay

Older Nvidia GPUs do not become obsolete upon the release of newer generations. Chips such as the A100 shift from cutting-edge training to inference, fine-tuning, and lower-cost workloads, extending their economic life. CoreWeave Inc. (NASDAQ: CRWV) signed a customer contract for A100 GPUs extending through 2029, nearly a decade after the architecture debuted.

Burry estimated last year that hyperscalers could understate depreciation by roughly $176 billion between 2026 and 2028 by stretching the useful lives of computing equipment. Longer useful lives reduce annual depreciation expenses. Meta (NASDAQ: META) stated in early 2025 that extending the useful lives of certain servers and network assets to 5.5 years would cut that year's depreciation expense by roughly $2.9 billion.

Burry argued in July that continued demand for older GPUs does not prove depreciation schedules are correct, noting, "A chip can rent and still depreciate very fast economically."

Market Signals and Infrastructure Funding

The economic lifespan of Nvidia's chips is critical as Wall Street mobilizes capital for AI infrastructure. Nvidia partnered with Apollo, BlackRock, Blackstone, Brookfield, Goldman Sachs, and KKR on platforms aimed at mobilizing more than $500 billion for AI infrastructure. CEO Jensen Huang stated lenders would consider utilization, cash flow, and residual value.

Kalshi traders bet on stable A100 rental prices. Kalshi's year-end market gives A100 compute about a 74% chance of finishing above $1.39 per GPU-hour, compared with a current rental price of roughly $1.29 on Silicon Data's A100 index. Kalshi Research noted in July that its A100 forward curve remained broadly flat into 2027, suggesting traders expect rental prices for the six-year-old chip to remain relatively stable. Rental prices for Nvidia's four-year-old H100 chips have also risen sharply recently.

What the Numbers Show

The divergence between Burry's depreciation warning and market data highlights a structural shift in asset valuation. While accounting rules focus on historical cost allocation over time, the secondary rental market values assets based on forward-looking cash flows. The fact that a six-year-old chip retains 99% of its initial implied value ($4,956 vs ~$5,000 baseline) suggests that the "useful life" for depreciation purposes may be decoupling from the "economic life" perceived by infrastructure investors relying on residual value metrics.

Nvidia Corp (NASDAQ: NVDA) shares traded slightly lower after-hours on Monday as CEO Jensen Huang reinforced the view that AI hardware is becoming a financeable asset class. Rental prices for the company’s three-year-old H100 GPUs climbed 22% in a month to $3.28 per hour, according to Ornn Exchange data.

Compute as a Revenue-Generating Asset

Huang described Nvidia compute as "fungible, durable and highly rentable" in a post on X. He characterized it as a productive, revenue-generating asset rather than conventional depreciating equipment.

The price increase for the H100 contradicts standard depreciation models, which typically assume older hardware loses value over time. Strong demand for AI computing has enabled some Nvidia GPUs to maintain or increase their rental economics despite their age.

Infrastructure Financing Push

Huang’s comments align with Nvidia’s broader strategy to treat AI chips like infrastructure. In August, Nvidia announced partnerships with Apollo Global Management (NYSE: APO), BlackRock Inc. (NYSE: BLK), Blackstone Inc. (NYSE: BX), Brookfield Asset Management (NYSE: BAM), Goldman Sachs (NYSE: GS) and KKR & Co. Inc. (NYSE: KKR).

The initiative aims to mobilize more than $500 billion in financing for AI infrastructure. This capital is intended to help AI labs, hyperscalers and enterprises fund data centers and Nvidia hardware using institutional and private sources.

Market Risks and Price Action

Ben Emons, founder of FedWatch Advisors, identified China as a significant threat to this financing strategy. He cautioned in August that China’s rapidly growing domestic AI computing capacity could flood the market with cheaper chips. Such a scenario could spark a price war and weaken the value of Nvidia GPUs used as collateral.

Legendary short-seller Jim Chanos previously warned that critical accounting issues involving Nvidia chips could pose massive financial risk to companies investing aggressively in the sector.

Nvidia shares closed at $230.36 on Friday, up 0.84%. They fell 0.38% to $229.49 in after-hours trading. Benzinga Edge Rankings place Nvidia in the 99th percentile for growth, with positive short-, medium- and long-term price trend ratings.