Happy Sunday everyone!

Saudi Aramco says it will keep borrowing to fund its massive expansion plans, despite a dip in Q1 profits. Over in the AI world, Nvidia CEO Jensen Huang called new megadeals in the UAE and Saudi Arabia “wins for America” as China sales slump. And British property mogul Asif Aziz is making headlines with a bold move to Abu Dhabi, where he’s eyeing the mid-market housing segment.

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Aramco to Keep Borrowing as Expansion Ambitions Grow

🛢️ What’s Happening

• Saudi Aramco has raised $5 billion in bonds this week and plans to continue borrowing to finance its aggressive expansion plans, according to CEO Amin Nasser.

• The bond sale saw strong demand, with spreads tightening significantly—a sign of investor confidence in Aramco’s financial stability.

• Aramco’s current gearing (debt-to-equity) ratio stands at just 5%, one of the lowest in the global oil industry.

💰 Why It Matters

• Despite a 4.6% drop in Q1 net income to $26 billion, Aramco remains focused on long-term growth, with $52–58 billion planned for capex in 2025, especially in natural gas and petrochemicals.

• The company is also reportedly exploring asset sales to generate cash, including sounding out investment bankers for ideas.

• Oil demand remains strong, with Nasser expecting 1.7 million barrels/day growth this year. Aramco’s ultra-low $3/barrel extraction cost keeps it resilient even in volatile price environments.

📉 Challenges

• Aramco’s stock has fallen 11% in the past six months, limiting its ability to raise equity capital.

• Performance-linked dividends plunged from SAR40 billion in Q1 2024 to just SAR800 million this quarter, despite higher base payouts.

• Investors may question sustainability of payouts amid falling income and rising debt.

🔮 What’s Next

• Expect more bond market activity from Aramco as it avoids equity dilution.

• US investors are likely first in line for any potential Aramco asset sale.

• The real test will be sustained global demand, as the company bets big on gas, chemicals, and downstream diversification in line with Vision 2030.

Markets

Nvidia CEO Hails Gulf AI Deals As ‘Wins For America’ Amid China Setbacks

📰 What Is It About

• Nvidia CEO Jensen Huang highlighted major AI infrastructure deals in Saudi Arabia and the UAE during the company’s Q1 earnings call, calling them “wins for America”.

• Huang said he was honoured to join former President Trump in announcing a 500MW AI project in Saudi Arabia and a 5GW AI campus in the UAE.

• These deals come as tightened US export controls have significantly impacted Nvidia’s sales to China, leading to a $4.5 billion charge and an estimated $2.5 billion in lost revenue in Q1.

• Despite the China hit, Nvidia raised its Q2 revenue forecast to $45 billion, projecting strong global demand for its AI infrastructure products.

💡 Why It Matters

• The deals in the Gulf are part of a strategic shift towards ‘sovereign AI’, where governments are building national AI infrastructure to reduce reliance on foreign platforms.

• Nvidia says nearly 100 AI ‘factories’ are under construction globally—double the number from last year—with the average chip count per site also doubling.

• The UAE and Saudi Arabia are leading this charge, with Saudi-backed Humain purchasing 18,000 Nvidia Grace Blackwell chips and planning to reach 1.9GW of capacity by 2030.

• Gulf states are using AI infrastructure as a pillar of economic diversification away from oil, offering cheap energy and data sovereignty to global partners.

🔮 What’s Next

• Nvidia is positioning itself as the backbone of the sovereign AI revolution, as more nations treat AI infrastructure like electricity or the internet.

• Saudi Arabia’s oversupply risk could become an opportunity to export AI capacity, with plans to treat international data centres as “digital embassies.”

• As China sales decline, the Gulf may emerge as a critical growth engine for Nvidia, reshaping global AI geopolitics in the process.

Asif Aziz Moves to Abu Dhabi, Eyes Mid-Market Housing in AGBI Exclusive

📰 What Is It About

• Asif Aziz, the billionaire behind Criterion Capital, is relocating from London to Abu Dhabi, joining a growing wave of wealthy individuals moving capital and lives to the Gulf.

• Aziz, who owns iconic London properties like the Criterion Building and One Leicester Square, is now targeting residential projects in Abu Dhabi, especially for long-term renters.

• He has set up shop in Abu Dhabi Global Market (ADGM) and purchased a home on Al Maryah Island, positioning himself for deeper involvement in the emirate’s booming property market.

💡 Why It Matters

• The move signals a broader shift in global capital toward the UAE amid political and tax changes in the West, including the UK’s scrapping of the non-dom tax regime.

• Aziz joins names like Nassef Sawiris, Lakshmi Mittal, and Ray Dalio, all part of a post-pandemic migration of high-net-worth individuals seeking low taxes, stability, and opportunity.

• His focus on affordable but quality housing in a market that saw 20% rental growth last year aligns with Abu Dhabi’s Vision 2030 goals to attract residents and diversify the economy.

🔮 What’s Next

• Criterion Capital plans to roll out mid-market residential developments, with hospitality to follow, mirroring the company’s Zedwell hotel success in the UK.

• With the UAE expecting 8,000 new millionaires this year and ADGM attracting global finance giants, Aziz’s move is both strategic and symbolic.

• For Aziz, the relocation is not just business—it’s personal. Drawn by Islamic culture, family values, and a “modern echo of the American dream”, Abu Dhabi is now home. As he puts it: “In the UAE, you don’t just talk about diversity – you live it.”

🔍From Smashi Business’ Desk

• Dubai’s Viral Chocolate Bar Just Landed in $3,000/Night Hotel Rooms—But You Still Won’t Find It at Carrefour.

🔍In other news…

• Jollibee Billionaire-Backed Hotel101 To Build 10,000 Rooms Worth $2.5 Billion In Saudi Arabia.

• Abu Dhabi to invest over $10 billion to power data center industry, says TAQA CEO.

• Expansion push to help JP Morgan double its Middle East revenue by 2030.

• Tabreed optimistic data centres will adopt district cooling amid sustainability push.

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