Nvidia Commits $20B to AI Chips as Samsung, TSMC Clash Over Supply
Nvidia pledged US$20 billion for AI chip startups, intensifying competition with OpenAI-backed ventures; its supply chain faces contention as Samsung leverages HBM capacity to secure LPU orders while TSMC counters. The company's inclusion among the five largest S&P 500 constituents has driven valuations to record highs, raising stall risks.
1. Nvidia Invests $20B in AI Chip Startups
Nvidia has committed US$20 billion to fund AI chip startups, matching the scale of investments by other major AI backers and aiming to accelerate development of next-generation processing units for data centers and AI applications.
2. Supply Chain Battle Over HBM and LPU Orders
Samsung is leveraging its lead in high-bandwidth memory (HBM) to secure Nvidia’s Light Processing Unit (LPU) orders, while TSMC is pushing back by expanding its own HBM-compatible production capacity and negotiating for a larger share of Nvidia’s chip output.
3. Record Valuations Heighten Stall Concerns
Nvidia’s stock surge during its AI-driven rally has helped the top five S&P 500 firms reach nearly 30% of the index, pushing valuation multiples to historic highs and prompting analysts to warn of a potential market correction.