All data are based on the daily closing price as of May 17, 2024

Samsung Electronics Secures Monumental AI Chip Deal with Naver Corp

Samsung will supply groundbreaking Mach-1 AI chips to Naver, potentially reshaping the AI technology landscape and reducing Naver's dependency on Nvidia
South Korea
s 005930.KO n 035420.KO Blue Chip 150 Semicon 75 Tech 350 OM 60
Share this on

Samsung Electronics Co., a global leader in memory chips, is set to fortify its presence in the artificial intelligence (AI) sector through a landmark deal with Naver Corp., valued at nearly 1 trillion won ($752 million). This agreement marks a pivotal shift for Naver, enabling the South Korean internet conglomerate to diversify its AI chip sources, currently dominated by Nvidia Corp. The deal involves Samsung’s next-generation Mach-1 AI chips, expected to be delivered by year’s end, signifying a major stride in AI hardware innovation.

Negotiations are ongoing between Samsung’s System LSI business division and Naver to finalize the details, with discussions focusing on the procurement of 150,000 to 200,000 units of the Mach-1 AI accelerator. This chip is poised to be a game-changer, offering advanced AI inference capabilities for server operations, notably for services like Naver Place, an AI-enhanced mapping solution.

Samsung’s Mach-1, distinct from traditional AI accelerators, integrates proprietary processors with low-power DRAM, enhancing efficiency and reducing the energy footprint. This innovative approach promises to diminish data bottlenecks significantly and improve computational sustainability, challenging the current industry standards set by Nvidia’s high-power, high-cost solutions.

The strategic collaboration with Naver not only underscores Samsung’s technological advancements in AI but also sets the stage for broader adoption across the tech industry. Samsung is already engaging in discussions with other Big Tech entities like Microsoft Corp. and Meta Platforms Inc., signaling the potential for widespread application of the Mach-1 technology.

Kyung Kye-hyun, at the helm of Samsung’s semiconductor division, highlighted the Mach-1’s tailored design to optimize AI model transformations, ensuring unparalleled efficiency and performance. This development is crucial for Samsung, positioning it as a formidable contender in the AI accelerator market, historically led by Nvidia and now increasingly competitive with players like SK Hynix advancing in the HBM arena.

As the AI accelerator market is projected to surge exponentially in the coming years, Samsung’s foray into this domain with the Mach-1 AI chip represents a strategic pivot towards dominating a future-centric technology landscape, aligning with industry demands for more efficient, powerful, and cost-effective AI solutions.

Share this on
Jakota Newsletter

Stay ahead in the JAKOTA stock markets with our roundup of vital insights

Icon scroll to top