Nvidia and TSMC’s Lucrative AI Alliance Shows Signs of Stress
Nvidia’s relationship with its chipmaker, TSMC, is arguably the most important of the current AI boom. But a production hiccup with a new Nvidia chip shows the growing pressures in their partnership.
The most successful and lucrative partnership in the artificial intelligence business is showing signs of strain.
In March, Jensen Huang, CEO of chip giant Nvidia, trumpeted the arrival of a family of new chips, known as Blackwell, designed to run the latest, most powerful AI software. Microsoft’s Satya Nadella, Tesla’s Elon Musk and nearly every other major leader in the tech industry offered gushing quotes about Blackwell in Nvidia’s announcement about the chip, which was to be made by Taiwan Semiconductor Manufacturing Co., Nvidia’s longtime partner.
Soon, though, the chest-thumping about the chip turned to finger-pointing between Nvidia and TSMC. During testing of the Blackwell chips in the weeks after Huang’s announcement, Nvidia engineers discovered that the chips failed in the types of high-voltage environments that are common in data centers, said two people with direct knowledge of the problem.