Nvidia invests $3.5 billion in Taiwan’s MediaTek for AI development

Taipei.- The American chip giant Nvidia invested 3.5 billion dollars in convertible bonds issued by the Taiwanese company MediaTek, which specializes in semiconductor design, as part of an agreement aimed at strengthening their collaboration in the development of artificial intelligence (AI) solutions.

The understanding, announced on Monday by both companies in a joint statement, represents an “expansion” of the existing collaboration between Nvidia and MediaTek and implies, according to Bloomberg, the largest direct investment by the Californian firm outside the United States to date.

Under this agreement, MediaTek will adopt Nvidia’s NVLink Fusion platform to integrate its technology into the systems of major cloud service providers. Both companies will also strengthen their cooperation in the development of AI platforms for personal computers and automobiles.

“The companies combine Nvidia’s accelerated computing, AI, graphics, and software platforms with MediaTek’s leadership in custom silicon, high-performance computing, low-power system-on-chip design, advanced packaging, interconnects, and connectivity,” the statement explains.

In statements included in the same text, Nvidia founder and CEO Jensen Huang defined MediaTek as “one of the world’s leading semiconductor companies, with exceptional expertise in system-on-chip design, connectivity, industry-leading performance, and energy efficiency“.

“Together, we are creating platforms that bring Nvidia’s accelerated computing to new markets and offer customers the freedom to create differentiated AI systems at scale,” he asserted.

Nvidia’s investment is part of a $3.9 billion convertible bond issuance launched by MediaTek, in which, according to Bloomberg, Alphabet, Google’s parent company, and other investors also participated.

This agreement is part of Nvidia’s efforts to ensure that the future of AI is based on its own hardware platform: last week, the also American company Amazon announced that it will add 2 million additional Nvidia graphics processing units to its data centers over the next two years.

You can also read: No more water consumption in data centers: Nvidia plans to replace it with nuclear energy

MediaTek soars on the stock market

Following the announcement of this collaboration, MediaTek shares listed on the Taipei Stock Exchange soared 9.94% at the opening this Tuesday, thus reaching their daily limit, to 4,315 New Taiwan dollars (136.48 dollars, 117.56 euros) per share.

Known worldwide for its smartphone chip design, MediaTek has benefited strongly from the artificial intelligence boom in recent months: its shares on the local stock exchange have soared 217.28% over the last year and have catapulted its market value to approximately 218.855 billion dollars, consolidating it as the island’s second-largest company by market capitalization, only behind TSMC.

MediaTek had already collaborated with Nvidia on the creation of the RTX Spark, a “superchip” for Windows personal computers that seeks to challenge the historical dominance of Intel and AMD in this segment.