Published Mon, Aug 31, 2026 · 10:20 PM
[SANTA CLARA, California] Nvidia is investing US$3.5 billion into MediaTek, deepening collaboration with the Taiwanese chipmaker at a time when it’s working to persuade more companies to build chips that plug into its dominant data center ecosystem.
Nvidia will buy bonds convertible into MediaTek shares, the companies said in a joint statement on Monday (Aug 31).
The investment broadens a partnership between the two chip designers that will see MediaTek using NVLink Fusion and the newly announced NVHBM technology as part of an Nvidia tech suite to help components communicate more seamlessly in data centres. The smaller company is trying to challenge Broadcom and Marvell Technology by helping owners of data centres create their own components.
For Nvidia, the new agreement is the latest effort to ensure the future of artificial intelligence is built around its hardware platform and standards. The company has been building data centre interconnect systems like NVLink Fusion and partnering with the likes of MediaTek to ensure it maintains a central role in the entire hardware chain, not just with its class-leading AI accelerators.
The MediaTek agreement follows a similar announcement by Amazon.com, which agreed to deploy an additional 2 million Nvidia components. Critically, Amazon also pledged to use Nvidia’s connection technology with its in-house chips.
Nvidia chief executive officer Jensen Huang, who was born in Taiwan, is tightening ties with a company working to reduce its reliance on the smartphone market. MediaTek earlier this year secured a partnership with Alphabet’s Google, and is gaining credibility as a design partner to major tech firms that are seeking to build their own AI chips. That momentum has led the chipmaker’s market value to roughly triple in recent months.
The agreements with MediaTek and Amazon give Nvidia the opportunity to retain its central role in the build-out of AI data centres even when companies are deploying chips designed to replace its main offerings. The deal is yet another example of Nvidia’s leadership investing in customers, rivals and other companies involved in the AI industry. Concern about the seemingly circular nature of those investments has percolated in investor circles, though Nvidia has strongly disputed the idea it’s creating false demand.
The company’s management has said the massive outlay is just another way of speeding adoption of its technology and will grease the wheels of the AI industry. Nvidia remains the main recipient of the massive spending on AI data centers by some of the world’s largest companies. Its accelerator chips, derived from graphics processors, excel at creating and running AI tools and services. It’s built on that dominance by developing a growing range of other technologies that include complete computers and networking.
That lucrative position has attracted a huge number of would-be rivals and spurred in-house chip efforts at its biggest customers, companies including Amazon, Google and Microsoft. So far, there’s no sign of Nvidia’s crown slipping: It’s forecasting a massive increase in sales of 70 per cent next year.
MediaTek already works with Nvidia on the US chipmaker’s nascent effort to get into the laptop industry. The Taiwanese company is helping with Nvidia’s RTX Spark product for that market.
MediaTek has also signalled that it plans to hire aggressively to better capture business opportunities from the AI boom. Forecasting AI chip revenue of about US$2 billion this year, the company has set the goal of securing as much as 15 per cent of an US$80 billion segment of the data centre market next year. BLOOMBERG
