To help world gorge on GPUs, Nvidia brings cash bucket to fatten wafer-thin supply chain

Nvidia is taking steps to ensure a steady supply of essential components for its GPUs and AI processors, as the demand for such technology continues to grow. The company has injected cash into its supply chain to support its suppliers and create certainty in the face of rising demand. Nvidia CEO Jensen Huang highlighted the need for capacity in various stages of production, including building substrates, advanced silicon packaging, testing, and creating optical connectors.

To increase substrate capacity, Nvidia has partnered with Samsung's Electro-Mechanics business unit, which will supply raw materials for Nvidia's products. By 2028, about a quarter of Samsung's substrate output will go to Nvidia. Additionally, Nvidia has expanded its partnership with Japanese substrate maker IBIDEN, with the goal of tripling production at an IBIDEN plant. Taiwanese player Unimicron is also benefiting from Nvidia's investment, with a capacity reservation agreement and associated plant expansion plans.

In the realm of silicon packaging, Nvidia has signed a capacity reservation with Korean company Amkor, which will see its production capacity expand by 300 percent. Nvidia aims to use this increased capacity to support higher production volumes for current and next-generation platforms. Furthermore, Nvidia plans to boost manufacturing capacity at optical connection provider SPIL, with the goal of expanding it 15 times by mid-2027, followed by a doubling of that capacity by the end of 2028.

These strategic moves indicate that Nvidia believes the AI infrastructure boom will continue for many years to come.