Samsung Is Turning to Rival TSMC for Nvidia’s Next AI Memory

This article first appeared on GuruFocus.

Nvidia Corp. (NVDA, Financials), the world’s leading manufacturer of AI chips, is said to be tightening its grip over the building of its next generation of high-bandwidth memory.Samsung Electronics is planning to employ Taiwan Semiconductor Manufacturing Co.’s 3-nanometer technology to build base dies for Nvidia’s proprietary NVHBM chips, a report said, citing industry sources.SK Hynix and Micron have also been asked by Nvidia to employ TSMC’s process for those base dies, while sixth-generation DRAM technology is used for the memory core dies.The significance of the move is that it would be the first time Samsung partnered with TSMC in the HBM production stage.who’s not typical for two businesses who are rivals in sophisticated chipmaking.The move might help standardize how several memory vendors develop NVHBM and eliminate volatility along the supply chain for Nvidia. It further cements TSMC’s critical role in AI hardware.Samsung, for its part, will continue be using its own production methodology for conventional HBM and special products for other clients.What to watch next is if TSMC capacity becomes a constraint as Nvidia pushes other manufacturers along the same path.