Nvidia Commits USD 2 Billion to Synopsys for AI Chip Design Collaboration
- tech360.tv
- 1 hour ago
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Nvidia has invested USD 2 billion in chip design software maker Synopsys as part of an expanded, multi-year tie-up. The companies will jointly develop new tools for designing products across industries using artificial intelligence (AI) technology.
The agreement comes amidst a series of investments by Nvidia, including stakes in OpenAI and Anthropic. These strategic moves aim to strengthen Nvidia's position in the evolving AI market.
The Synopsys collaboration is focused on transitioning high-tech industries, which are beginning to adopt AI, away from traditional central processing units. The shift will be towards graphics processing unit chips sold by Nvidia.
Synopsys software is widely used to design a variety of products, ranging from computer chips to jet engines. Engineers employ these tools to virtually simulate designs on computers before committing to expensive prototype manufacturing.
These complex simulations, which traditionally can take weeks, could be expedited to just a few hours using Nvidia's chips. This potential for significant speed-up was highlighted by the chief executives of both companies.
Nvidia Chief Executive Officer Jensen Huang stated, "The order of magnitude speed-up is going to unlock opportunities that have never been possible before."
Synopsys and Nvidia operate as customers for each other's organisations. Nvidia's extensive investments have prompted concerns that it may be incentivising customers to purchase its chips.
Synopsys Chief Executive Officer Sassine Ghazi indicated that the Nvidia capital will provide Synopsys with "optionality" as it adapts its software for Nvidia chips. Ghazi clarified that there is "no intention or commitment to use that USD 2 billion to purchase Nvidia GPUs."
Ghazi added that using Nvidia GPUs is "something that we do on a normal course of business." Both chief executives confirmed the agreement is non-exclusive, with Ghazi stating Synopsys is open to collaborating with other chipmakers.
Ghazi further explained, "If an AMD or an Intel or whichever customer wanting to capture a similar opportunity (approaches Synopsys), it's not exclusive. We're willing and happy to work with them."
Following the announcement, Synopsys shares increased by nearly 5%, while Nvidia's shares rose by 1.4%.
Nvidia, recognised as the world's most valuable company, has invested billions of USD this year in various companies linked to the rapidly expanding AI industry. These deals include agreements that could allow for as much as a USD 100 billion investment in OpenAI, the parent company of ChatGPT, and a USD 5 billion stake in Intel.
Nvidia acquired Synopsys's common stock at USD 414.79 per share, the companies reported. This price represented a discount of about 0.8% compared to the stock's last closing price on Friday.
Synopsys also lists AMD among its customers, while Nvidia engages with Cadence Design, a rival firm in electronic design automation. Shares of Cadence, which had announced its own collaborations with Nvidia earlier this year, remained relatively stable.
Nvidia has invested USD 2 billion in Synopsys for a multi-year partnership focused on AI chip design.
The collaboration aims to accelerate product design simulations using Nvidia's graphics processing unit chips.
Synopsys Chief Executive Officer Sassine Ghazi stated the USD 2 billion investment is not a commitment to buy Nvidia GPUs and that the deal is non-exclusive.
Source: REUTERS