Nvidia and Amkor Technology have signed a multi-year agreement worth $1.5 billion to expand advanced semiconductor packaging and testing capacity in the U.S. The deal aims to support the growing demand for AI infrastructure and jointly develop new packaging technologies.
This significant deal underscores the intense race to build out AI infrastructure and highlights Nvidia's strategy to secure advanced packaging capacity, a critical bottleneck in chip production, by forging strategic partnerships.
Nvidia and Amkor Technology have entered into a multi-year agreement valued at $1.5 billion to expand advanced semiconductor packaging and testing capacity in the United States. The deal is aimed at meeting the surging demand for AI infrastructure.
Under the terms of the agreement, Nvidia will make a prepayment to Amkor to support the expansion of its U.S. advanced packaging operations, including facilities in Arizona. The two companies will collaborate on developing new packaging and testing technologies specifically for Nvidia's artificial intelligence and accelerated-computing platforms, with a focus on integrating different chip types into a single package.
Amkor Technology already provides advanced packaging solutions for Nvidia's existing product portfolio, including its data center processors. This expanded partnership is expected to accelerate the introduction of new packaging technologies to the market.
In related developments, Amkor also recently established a 10-year partnership with TSMC to enhance semiconductor packaging capabilities in the U.S. and is working with Advanced Micro Devices on packaging their chips. Following the announcement of the Nvidia deal, Amkor's shares jumped 17% in extended trading.