Nvidia Invests $3.5 Billion in MediaTek to Expand AI Chip Partnership

NVDA disclosed a $3.5 billion investment in MediaTek, structured as convertible bonds issued by the Taiwanese chipmaker, deepening a partnership aimed at building AI computing platforms that span from edge devices to data center scale workloads. The investment is part of a larger $3.9 billion convertible bond offering from MediaTek that also drew Alphabet as a participant, with terms of Alphabet's stake undisclosed.

The centerpiece of the deal is Nvidia's NVLink Fusion platform, which lets MediaTek build custom AI accelerators, or XPUs, that plug directly into Nvidia's data center interconnect fabric using NVLink-C2C and NVHBM memory integration. The companies are also extending an existing collaboration into MediaTek's Dimensity Auto platforms for AI-powered vehicles and into consumer AI PCs, building on a June 2026 partnership around Nvidia's RTX Spark chip.

The move fits a broader Nvidia strategy: as hyperscalers such as Amazon, Google, and Microsoft develop their own custom AI chips to reduce dependence on Nvidia GPUs, Nvidia is positioning itself to stay central to that infrastructure by supplying the interconnect and software those custom chips run on. Nvidia CEO Jensen Huang framed the tie-up as spanning "every computing platform, from the world's largest AI factories to the PC and the car." MediaTek's custom data center chip business is targeting roughly $2 billion in revenue for 2026.

Investors read the deal as a vote of confidence: MediaTek shares jumped nearly 10% in Taipei trading, extending a roughly 200% rally for the stock so far in 2026, while Nvidia shares were little changed on the day. For MediaTek, long the top vendor of smartphone chipsets, the partnership adds credibility to its push into data center silicon, an area where it competes with Broadcom and Marvell rather than with Nvidia itself.

The deal underscores how chipmakers are pairing capital with technology licensing to lock in AI era partnerships. Market participants could watch for early NVLink Fusion prototype announcements, the pace of joint PC and automotive product releases, and whether MediaTek's custom chip momentum holds up against Broadcom and Marvell in the data center market.

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