NVIDIA Faces AI Chip Shortages, Turns to Intel for Advanced Packaging Services

[AleksandarK]

NVIDIA's supply of AI chips remains tight due to insufficient advanced packaging production capacity from key partner TSMC. As per the UDN report, NVIDIA will add Intel as a provider of advanced packaging services to help ease the constraints. Intel is expected to start supplying NVIDIA with a monthly advanced packaging capacity of about 5,000 units in Q2 at the earliest. While TSMC will remain NVIDIA's primary packaging partner, Intel's participation significantly boosts NVIDIA's total production capacity by nearly 10%. Even after Intel comes online, TSMC will still account for the lion's share—about 90% of NVIDIA's advanced packaging needs. TSMC is also aggressively expanding capacity, with monthly production expected to reach nearly 50,000 units in Q1, a 25% increase over December 2023. Intel has advanced packaging facilities in the U.S. and is expanding its capacity in Penang. The company has an open model, allowing customers to leverage its packaging solutions separately.

The AI chip shortages stemmed from insufficient advanced packaging capacity, tight HBM3 memory supply, and overordering by some cloud providers. These constraints are now easing faster than anticipated. The additional supply will benefit AI server providers like Quanta, Inventec and GIGABYTE. Quanta stated that the demand for AI servers remains robust, with the main limitation being chip supply. Both Inventec and GIGABYTE expect strong AI server shipment growth this year as supply issues resolve. The ramping capacity from TSMC and Intel in advanced packaging and improvements upstream suggest the AI supply crunch may be loosening. This would allow cloud service providers to continue the rapid deployment of AI workloads.



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[Bwaze]

"Divert all Gaming manufacturing to the real bussiness!"

 

[Chomiq]

Meanwhile at Intel:

 

[MarsM4N]

That's right, evil unite! PS: FK G4M3RS!

 

[Daven]

Given the shortage in fab and packaging capacity, is it too surprising that AMD and Nvidia might prioritize products that make more money over those that make less?

Let’s do the math. The H100 dies size is about 810 mm^2. The 4060 is about 160 mm^2. So Nvidia can make about 5 4060s for every H100. A 4060 costs $300 or $1500 for 5. A single H100 costs $30,000. This is not very hard to understand guys especially since Nvidia could even be selling more H100s than 4060s. Just because you want something to happen does not mean it will. Nvidia abandoning the low end to midrange gaming GPUs in favor of compute GPUs is NOT out of the realm of possibilities.

 

[remixedcat]

hope it continues and they run out and boo hoo all the way home ... and jensingsongdingdong ends up in some hole in wyoming w some ____

 

[Denver]

"Divert all Gaming manufacturing to the real bussiness!"

"Why settle for selling our chips at a mediocre 50% profit margin, only to share the profits with stores and AIBs? Instead, let's explore the option of directly selling AI products to companies, with significantly higher profit margins, reaching tens of thousands of units per customer." - Leather jacket CEO