Nvidia signs deals to boost AI chip component production up to 15-fold

Nvidia has entered agreements with six suppliers to significantly increase the production capacity of components used in its artificial intelligence chips, according to Manufacturing Dive and Supply Chain Dive.

The suppliers involved include Ibiden, Samsung Electro-Mechanics, Unimicron Technology Corp., Amkor Technology, King Yuan Electronics Co., and Siliconware Precision Industries. These agreements aim to scale production of certain components by as much as 15 times.

Ibiden, Samsung Electro-Mechanics, and Unimicron, which manufacture substrates that connect Nvidia’s processors to main circuit boards, will increase their capacity by 2.5 times collectively over three years. Samsung Electro-Mechanics is upgrading facilities and building new factories in South Korea, allocating a significant portion of its substrate production to Nvidia by 2028.

Unimicron plans a manufacturing expansion in Taiwan starting in mid-2027, reaching full capacity by mid-2028. Ibiden is expanding a plant in Japan with a multibillion-dollar capacity reservation from Nvidia, aiming to triple current capacity and begin additional production in early 2028.

Amkor Technology will expand its South Korea plants to increase capacity for advanced packaging, the process of assembling chips into connected units, supporting Nvidia’s AI chip production needs.

Nvidia’s CEO Jensen Huang described the current period as the largest infrastructure buildout in history, with demand for AI systems outstripping capacity, making these supplier agreements critical to meeting market needs.