Samsung Secures Nvidia Deal as AI Chip Landscape Shifts

Nvidia (NVDA.US) has officially confirmed that its latest AI accelerator chip, the GB300, will integrate Samsung's fifth-generation high-bandwidth memory technology, known as HBM3E. This marks a significant achievement for Samsung as it finally secures a spot in Nvidia's supply chain after multiple challenges. This development indicates a strengthening alliance between Samsung and Nvidia, with potential implications for the future landscape of AI hardware.

Insiders have indicated that Nvidia CEO recently communicated with Samsung Electronics Chairman Lee Jae-yong via formal correspondence, affirming that the GB300 chip will feature Samsung’s 12-layer stacked HBM3E technology. The two firms are currently finalizing negotiations on aspects like supply quantities, pricing, and timelines, suggesting that this partnership is on the brink of further definition.

While Micron Technology and SK Hynix have been pivotal suppliers for Nvidia’s HBM solutions, including HBM3E, Samsung's entry into the supply chain is noteworthy. Micron’s stock experienced a 3% decline in afternoon trading on Thursday, possibly reflecting ripples caused by these developments. Additionally, SK Hynix remains an essential provider of storage chips for Nvidia, implying a competitive supplier environment.

Samsung’s certification by Nvidia represents over a year of concerted efforts. Despite the AI hardware industry steadily transitioning towards the sixth-generation HBM4 chips, the quantity of HBM3E chips supplied by Samsung might not be substantial. However, the approval acts as a significant milestone with the potential to expedite HBM4’s mass production certification, setting the stage for future advancements.