During Computex 2025, Nvidia CEO Jensen Huang once again emphasized that Taiwanese TSMC is the only “suitable” chip partner for Nvidia for the production of its advanced chips.
Despite attempts to collaborate with American manufacturers such as Intel and Samsung Foundry, Nvidia sees no alternative that can match TSMC’s technology and capabilities.
One of the main reasons for this is TSMC’s leading position in the so-called CoWoS technology (Chip-on-Wafer-on-Substrate), an advanced packaging method.
By stacking multiple chips on top of each other, Nvidia can deliver performance that is not achievable through node shrinking alone. At Computex, Nvidia CEO Jensen Huang emphasizes that this technique is crucial for Nvidia’s product development and that TSMC is the only chip manufacturer worldwide that has mastered this at this level.
The only downside to this principle is that it drives up power consumption. Process shrinks bring energy efficiency. By stacking chips, you don’t increase efficiency, and chips will require more and more energy to deliver higher performance.
Deepening Collaboration with TSMC
In recent years, Nvidia has deepened its collaboration with TSMC. It goes without saying that the rise of AI applications has something to do with this. Huang states that although there were talks with Samsung and Intel about alternatives for chip production, these ultimately did not lead to a workable deal. This means that Nvidia will continue to rely entirely on TSMC for the fabrication process in the near future.
From a strategic perspective, TSMC also plays a major role in Nvidia “’s global supply chain. With TSMC”’s recent expansion of factories in the United States, including in Arizona, the impact of geopolitical tensions is partially mitigated.
Huang calls it crucial that Nvidia has a reliable and technologically leading partner that can also spread production to manage risks.
AMD is the Odd one Out
According to Huang, Nvidia is even TSMC’s largest customer, which further strengthens the bond between both companies. The collaboration even surpasses that with Apple, which traditionally is one of TSMC’s biggest customers.
This close relationship emphasizes the mutual interest in continuing to invest together in the future of advanced chip production. AMD is the odd one out, as it now has to look for an additional chip manufacturer for its GPUs because the CoWoS line is fully occupied by Nvidia.
In short, Huang’s message at Computex is clear: despite political pressure and the desire to spread chip production more, there is no alternative to TSMC for Nvidia on a technological level. The Taiwanese chip manufacturer remains indispensable to achieve Nvidia’s high performance standards and innovations, with CoWoS as the technological flagship.
During Computex, Huang called the US export ban “a failure”. In 2021, when the Biden administration took office, Nvidia still had a 95 percent market share in China. Due to the export ban and sanctions from the US government, that share has now dropped to about 50 percent.