Nvidia Stock Alert: LG Chooses FuriosaAI Chip Over Nvidia's GPUs

FuriosaAI, a South Korean startup, has secured LG as its first major customer for its AI chip, RNGD. This development could accelerate adoption of non-Nvidia solutions in Asia's booming AI ecosystem, raising competitive pressure for Nvidia. However, investors should note that FuriosaAI is privately held and Nvidia is not in direct competition with it for institutional capital. The consensus rating on Nvidia shares remains at "strong buy" with a mean target of $183, indicating potential upside of 8%.

FuriosaAI, a South Korean startup, has secured LG as its first major customer for its AI chip, RNGD. This development could accelerate the adoption of non-Nvidia solutions in Asia's booming AI ecosystem, raising competitive pressure for Nvidia. However, investors should note that FuriosaAI is privately held and Nvidia is not in direct competition with it for institutional capital. The consensus rating on Nvidia shares remains at "strong buy" with a mean target of $183, indicating potential upside of 8%.

FuriosaAI, which declined a $800 million acquisition offer from Meta in March, has partnered with LG AI Research to supply its RNGD chip. The RNGD chip is optimized for running large language models (LLMs) and is expected to power LG's EXAONE 4.0 platform, a leading sovereign AI model in South Korea [1]. The collaboration targets key sectors such as electronics, finance, telecommunications, and biotechnology.

LG's decision to adopt FuriosaAI's chip is notable for several reasons. It is one of the few public endorsements of a rival to Nvidia by a major enterprise. Additionally, the RNGD chip outperformed competitive GPUs with LG AI Research’s EXAONE models, delivering 2.25 times better inference performance and being more energy-efficient [1].

FuriosaAI's CEO, June Paik, stated that the partnership will lead to business possibilities far beyond South Korea. The startup is now targeting the US, Middle East, and Southeast Asia markets for its next set of customers. Paik expects to secure similar agreements in the second half of this year [2].

While FuriosaAI faces stiff competition from established players like Nvidia, its innovative approach to AI chip design and strategic partnerships are positioning it as a strong contender in the market. However, Nvidia stock remains a top idea among analysts, with Morgan Stanley viewing it as a "top idea" heading into the AI darling's earnings print scheduled for the final week of August [3].

Investors should closely watch FuriosaAI's progress as it continues to raise capital and prepare for an initial public offering. Despite the challenges, the startup's rejection of Meta's acquisition offer has fueled its pursuit of independence and growth.

References:
[1] https://techcrunch.com/2025/07/21/instead-of-selling-to-meta-ai-chip-startup-furiosaai-signed-a-huge-customer/
[2] https://www.ainvest.com/news/furiosaai-lands-major-contract-rejecting-meta-800m-acquisition-offer-2507/
[3] https://finance.yahoo.com/news/nvidia-stock-warning-nvda-challenger-184049791.html