Nvidia Strengthens AI Chip Supremacy with Multi-Year Meta Deal

American tech giant Nvidia is consolidating its dominance in the artificial intelligence (AI) chip market through a multi-year agreement with social media giant Meta Platforms, under which Meta will receive several million AI chips. The announcement was reported by Reuters.

On Tuesday, 17 February, Nvidia confirmed the agreement, stating that it will supply current Blackwell and upcoming Rubin AI chips, along with Grace and Vera central processing units (CPUs). While the financial details of the deal were not disclosed, analysts estimate the value could exceed $50 billion.

Analysts view Nvidia’s move as a strategy not only to reinforce its position in the graphics processing unit (GPU) market but also to strengthen its standing in CPUs designed for data centers. These chips will primarily be used to run AI agents and manage large-scale databases.

Ian Buck, General Manager of Nvidia’s Hyperscale and High-Performance Computing division, explained that the Grace CPU can handle routine tasks, such as database management, using half the energy, while the next-generation Vera CPU is expected to deliver even higher performance. He noted that Meta has already tested the Vera platform, with highly promising results.

Meta is reportedly developing its own AI chips and is in discussions to utilize Google’s Tensor Processing Units (TPUs). However, this major agreement with Nvidia underscores the continued importance of Nvidia chips within Meta’s AI infrastructure.

Nvidia has never publicly disclosed the exact volume of direct sales to Meta, but it is estimated that in the last fiscal quarter, 61 percent of Nvidia’s total revenue came from just four customers, including Meta.

DBTech/BMT/OR