MediaTek and Nvidia announced Monday a strategic partnership in artificial intelligence, with the U.S. giant investing $3.5 billion in convertible bonds in the Taiwanese chip manufacturer. MediaTek shares closed 10% higher Tuesday, extending their rally to nearly 200% since the start of the year. MediaTek, the world’s biggest smartphone chip company by market share according to Counterpoint Research, is seeking to diversify by designing custom chips for data centers and AI applications. The partnership will allow MediaTek to use Nvidia’s NVLink Fusion platform for its custom chips and collaborate on local AI computing for PCs and automotive systems. MediaTek expects to generate $2 billion in revenue this year from its custom AI chip business, with a total addressable market of up to $80 billion by 2027.
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