Nvidia announced Monday that it will begin selling semicustom artificial intelligence systems that use central processing units and AI chips from competitors. Meanwhile, Nvidia stock was largely unchanged.
Nvidia executives say the company is responding to customer requests with its new product initiative called NVLink Fusion. The AI chipmaker made the announcement at the Computex conference in Taiwan.
With NVLink Fusion, customers can build AI infrastructure that uses central processing units, or CPUs, from other vendors along with Nvidia Blackwell graphics processing units, or GPUs. Alternatively, customers can use Nvidia Grace CPUs with custom AI chips from other companies. In both cases, the semicustom AI systems will use Nvidia's NVLink computing fabric.
The initial CPU partners for NVLink Fusion are Fujitsu and Qualcomm. The custom AI silicon providers in the program include Alchip Technologies, Astera Labs, Marvell Technology and MediaTek.
Also, chip design software firms Cadence Design Systems and Synopsys have joined the NVLink Fusion initiative.
"NVLink Fusion opens Nvidia's AI platform and rich ecosystem for partners to build specialized AI infrastructures," Nvidia Chief Executive Jensen Huang said in a news release.
Nvidia expects the number of companies involved in NVLink Fusion to grow over time.
"As we continue to roll this out and deploy this and see more adoption, I'm sure that ecosystem will continue to grow," Dion Harris, Nvidia senior director of high-performance computing and AI factory solutions, said on a conference call with news media.
Nvidia Stock Is Consolidating
IBD MarketSurge charts show Nvidia stock in a 19-week consolidation period with a buy point of 153.13. That buy point is also the stock's all-time high, reached on Jan. 7.
On the stock market today, Nvidia stock rose a fraction to close at 135.57.
In a keynote speech at Computex, Huang discussed developments in quantum computing, digital twins for factory simulation, and robotics, including humanoid robots.
In addition, he announced Nvidia DGX Cloud Lepton, a unified AI platform and marketplace for connecting software developers with the Nvidia GPU ecosystem.
Also, Nvidia announced Acer, Gigabyte and MSI as new manufacturers of its DGX Spark and DGX Station AI workstations. They join Dell Technologies, HP and others.
Plus, Nvidia revealed new RTX Pro servers for accelerated computing applications.
In other news, Nvidia announced that it is working with Foxconn and the Taiwanese government to build an AI supercomputer in Taiwan. The project is the latest sovereign AI venture after Nvidia announced a major deal last week with Saudi Arabia. It also is poised to grab a big chunk of business from data center plans in the United Arab Emirates.
NVLink Fusion Called 'Strategic Move'
The NVLink Fusion announcement was the most important news from Huang's Computex keynote, Rosenblatt Securities analyst Kevin Cassidy said in a client note.
"We view this technology as a strategic move by Nvidia to take part in upcoming custom silicon roadmaps from customers, including hyperscalers," Cassidy said. He rates Nvidia stock as buy with a price target of 178.
Melius Research analyst Ben Reitzes called NVLink Fusion "a big deal."
"It means that Jensen would rather sell you something vs. nothing and Nvidia is going after more share of (the) $1 trillion in data center spending," Reitzes said in a report. "We think it also hints at the desire to sell much more software down the road."
Reitzes rates Nvidia stock as buy with a price target of 150.
Follow Patrick Seitz on X, formerly Twitter, at @IBD_PSeitz for more stories on consumer technology, software and semiconductor stocks.
