Nvidia Invests $4B in Photonics Companies After Reports of New AI Processor Emerge

AI leader Nvidia has said it is investing a total of $4 billion in Lumentum and Coherent to innovate optics technology for scaling next-gen data centre architecture as part of its AI infrastructure buildout strategy. The announcement comes days after reports emerged that Nvidia is planning to launch a new AI processor to speed up computing.

Nvidia will invest $2 billion in Lumentum and Coherent each. Both companies are developing systems to generate or transmit light for functions like data transfer and sensing. Optical interconnects and advanced package integration facilitate ultrahigh-bandwidth and energy-efficient connectivity across AI factories.

'This multiyear strategic agreement reflects our shared commitment to advancing the optics technologies that will power the next generation of AI infrastructure,' said Lumentum CEO Michael Hurlston.

'In support of this collaboration, we are also investing in a new fabrication facility to increase capacity and accelerate innovation. We're excited to work together to expand what's possible for the AI optical architectures of tomorrow.'

US-based Lumentum develops photonic technologies to power the networks and infrastructure running AI, cloud computing, and communications. Nvidia said it will also invest in a new fabrication facility to ramp up capacity.

Meanwhile, Coherent focuses more on harnessing photons to create components that enable high-performance optical applications. Nvidia will work with the companies to accelerate R&D in data centre optics and boost US-based manufacturing. The nonexclusive agreements include Nvidia's multibillion-dollar purchase commitments and future capacity access rights to new-age laser components.

'AI has reinvented computing and is driving the largest computing infrastructure buildout in history,' said Nvidia CEO Jensen Huang, adding that with Lumentum and Coherant, Nvidia is making the most sophisticated silicon photonics to build gigawatt-scale AI factories.

Huang explained that computing has fundamentally changed, and these partnerships will support software running on AI to fine-tune interactions and context with speed.

'This strategic relationship underscores Coherent's role as a key enabler of next-generation AI data centre infrastructure,' Coherent CEO Jim Anderson. 'We are proud to expand our 20-year relationship with NVIDIA by increasing their access to include multiple product families to help them build the AI data centres of the future.'

Nvidia's New AI Chip to Support OpenAI

The Wall Street Journal reported in late February that Nvidia is planning to launch a new AI chip customised to help OpenAI and other clients develop more efficient AI tools faster. The new platform is expected to be unveiled at Nvidia's upcoming GTC developer conference and will incorporate a chip designed by the startup Groq, whose chips use a different architecture from Nvidia's GPUs to handle inference tasks more efficiently.

Nvidia is designing a new system for 'inference' computing, a vertical that is facing stiff industry competition. Sources told the media outlet that OpenAI has agreed to be among the largest customers of the new processor.

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