Nvidia taps Samsung Electro-Mechanics for AI chips substrate supply chain

U.S. chip giant Nvidia said Wednesday that Korea's Samsung Electro-Mechanics is joining its semiconductor substrate supply chain as part of a broader initiative to expand manufacturing capacity.

Samsung Electro-Mechanics, the electronic components unit of Samsung Electronics, will initially provide production capacity from its existing operations in Korea, while the collaboration will also support facility upgrades and new factories in Sejong and Busan, according to Nvidia.

By 2028, production allocated to Nvidia is projected to account for a significant portion of Samsung Electro-Mechanics' total annual package substrate production capacity, the U.S. company said.

Samsung Electro-Mechanics also issued a separate press release, calling the deal a strategic business partnership to strengthen the global AI semiconductor supply chain, and said it plans to supply Nvidia with package substrates for AI semiconductors under a multiyear agreement beginning in 2026.

Separately, Nvidia and U.S.-based Amkor Technology plan to expand advanced semiconductor packaging capacity in Korea, targeting an increase of more than 300 percent in interposer wafer capacity by the end of 2028, the U.S. company said.

The planned expansion, alongside Amkor Technology's development of new manufacturing facilities in Korea, will support higher production volumes for Nvidia's current and next-generation platforms.

The announcements were part of Nvidia's broader initiative unveiled at its GTC event in Berlin to expand global manufacturing capacity with suppliers amid growing demand for AI computing infrastructure.

Nvidia said agreements with Samsung Electro-Mechanics, Japan's Ibiden and Taiwan's Unimicron Technology would contribute to its plan to increase substrate capacity for its products by 2.5 times over the next three years.

Yonhap