Nvidia is investing $3.5 billion into Taiwanese chip company MediaTek as part of a partnership that strengthens its position against the boom in custom chips developed by big tech and AI firms.

The two companies said Monday that MediaTek will adopt Nvidia’s NVLink Fusion platform to provide hyperscalers and AI labs with a “prevalidated path” for developing custom chips that work with Nvidia infrastructure.

CEO Jensen Huang said the deal would “give customers the freedom to create differentiated AI systems at enormous scale” by aligning Nvidia with MediaTek’s “expertise in system-on-chip design, connectivity, leading performance and power efficiency.”

The $3.5 billion investment into convertible bonds highlights Nvidia’s need to keep up with custom chip demand after OpenAI, one of its largest customers, launched its first custom AI accelerator chip with Broadcom.

Nvidia’s market investments

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