In brief
Nvidia has secured deals to supply over 260,000 advanced AI chips to South Korea, partnering with major companies like Samsung and LG. This move aims to bolster South Korea's position as a key player in AI technology while navigating challenges posed by US-China trade disputes. The initiative reflects Nvidia's efforts to expand its global AI presence and enhance regional capabilities in digital innovation.
US chip giant Nvidia will supply more than 260,000 of its most advanced artificial intelligence (AI) chips to South Korea's government, as well as Samsung, LG, and Hyundai.
The companies will deploy the AI chips in factories to produce semiconductors, autonomous vehicles, and more, enabling South Korea to 'now produce intelligence as a new export,' declared CEO Jensen Huang.
The value of these deals remains undisclosed, but they mark a significant step for Nvidia, which recently became the first company ever to be valued at $5 trillion. The announcements came amidst signs of improving trade relations between the US and China, hinting at the potential for Nvidia to increase its exports to China as well.
At a CEO summit during the Asia Pacific Economic Cooperation (APEC) in Gyeongju, Huang stated these chips would allow the creation of 'digital twins' with factories worldwide, showcasing the potential of these partnerships to transform supply chains.
South Korea aspires to become an AI hub, leveraging its semiconductor production strengths and infrastructure capabilities. The government's plan involves building a 'sovereign AI' computing framework controlled locally, with over 50,000 Nvidia chips allocated for data centers, including at Kakao and Naver.
However, Nvidia faces challenges from ongoing US-China trade tensions, which have restricted its chip sales in China, a market that previously constituted a substantial share of its revenue. Huang expressed disappointment over the current zero share of AI business in China, while looking forward to potential policy changes that might facilitate re-entry into that market.
As Nvidia seeks to broaden its international partnerships, it continually assesses the dynamics of the Asia Pacific region, engaging with local manufacturers like Samsung and SK Hynix to strengthen its supply chain amidst heightened global competition.
