According to South Korean media quoted by Taiwan, China media, Nvidia is planning to outsource some AI GPUs to Samsung for manufacturing due to the increasingly tight capacity supply of TSMC.

According to the semiconductor industry, Nvidia is negotiating with Samsung on relevant production contracts, and their performance verification discussions are based on the most advanced technology.

However, most South Korean industry insiders believe that Samsung is not likely to obtain large-scale orders from Nvidia, but it is not ruled out that Samsung may become Nvidia's second-generation manufacturing partner, because it is difficult to complete all AI GPU orders only relying on TSMC.

Some analysts said that although Samsung's 3nm process has not yet achieved stable mass production performance, Nvidia may cooperate with Samsung to reduce the risk of supply shortage in order to cope with the rapid surge in demand for AI GPUs.

In addition, whether Samsung's advanced packaging technology can meet Nvidia's requirements is another key factor determining whether this cooperation can be realized.

The Korean media has pointed out that Nvidia A100 and H100 are now completely outsourced to TSMC, and Samsung has failed to win any orders, which is entirely because TSMC CoWoS advanced packaging technology is ahead of Samsung.

Industry observers pointed out that if Samsung's 3nm test products pass the performance verification and its 2.5D advanced packaging technology meets the requirements, the company is expected to obtain some orders from Nvidia.

How strong is the demand for AI chips?

Recently, it has been reported that due to the increase in demand for CoWoS by AI, TSMC initiated the second wave of tracking orders from equipment manufacturers at the end of June, and requested suppliers to fully shorten delivery time support. It is expected that there will be a peak of a large number of shipments from the fourth quarter of this year to the first quarter of next year.

Behind this, Nvidia, Broadcom and AMD have all invested in TSMC. Due to the growth of demand in the AI field, the three companies not only increased the orders of TSMC's 5/7nm family manufacturing process quarter by quarter since the second quarter, but also competed for TSMC's CoWoS capacity. The strong momentum of order chasing has continued to 2024, and the overall order size has increased by more than 20% compared with 2023.

Data shows that by 2028, the global GPU market size may increase from $19.711 billion in 2021 to approximately $33.463 billion, with a compound annual growth rate of 7.85% during this period.