Nvidia will invest $3.5 billion in MediaTek to deepen AI chip cooperation

NVIDIA (NVDA.O) will invest $3.5 billion in MediaTek, further deepening the cooperation between the two parties. Currently, NVIDIA is working to persuade more companies to develop chips that can connect to its dominant data center ecosystem. The two companies stated in a joint announcement that NVIDIA will purchase bonds that can be converted into MediaTek stock. This investment will expand the collaboration between the two chip designers.

According to the cooperation arrangement, MediaTek will adopt NVLink Fusion and the newly announced NVHBM technology, which are part of NVIDIA's technology suite aimed at facilitating smoother communication among various components in data centers. MediaTek is trying to challenge the market positions of Broadcom (AVGO.O) and Marvell Technology (MRVL.O) by helping data center operators create customized components.

Previously, Amazon (AMZN.O) also announced a similar cooperation agreement, agreeing to deploy an additional 2 million NVIDIA components. More importantly, Amazon also committed to using NVIDIA's connectivity technology in its self-developed chips.