Stocks of semiconductor companies surged throughout Asia, Europe and the United States after Nvidia’s and OpenAI’s $100 billion strategic partnership announcement. In that light, the landmark deal for the deployment of at least 10 gigawatts of GPU-powered AI data center capacity furthers the AI arms race while cementing Nvidia in the center of future computing architecture.
Nvidia’s stock has surged to new highs
On the 22nd of September, Nvidia announced its intention to invest up to $100 billion in OpenAI, creating an unprecedented bond between a chipmaker and an AI developer. Nvidia’s shares moved up 4.4 percent at intraday peak levels on renewed excitement among investors for reinforced hardware-software integration. As Wall Street analysts said, the deal secured not only Nvidia a recurring revenue stream from chip sales, but also its roadmap was tied straight to OpenAI’s ambitious compute requirements.
Another immediate beneficiary was Taiwan Semiconductor Manufacturing Co. (TSMC)—the sole fabricator of Nvidia’s most advanced AI processors. TSMC shares gained 3.5 percent in Taipei trading, reflecting the assurance of premium orders being sustained from Nvidia. Similarly, Foxconn’s semiconductor unit in Taiwan is surging due to prospects of boosted chip output for AI data centers.
Memory makers join the climb
South Korea’s memory was also rewarded. SK Hynix shares gained 2.5 percent while Samsung stocks rose 1.4 percent on expectations of soaring demand for high-bandwidth memory modules essential for large-scale AI deployments. The expected power requirements, which are said to be equal to the energy needs of millions of homes, have reinforced the significance of memory in training and inference workloads related to AI.
European chip equipment stocks advance
In Europe, semiconductor equipment manufacturers registered broad-based gains. The Stoxx 600 electronics index rose by 1.98 percent, thanks to STMicroelectronics (+3.2 percent) and Infineon (+3 percent) as markets began to price expectations of a lengthy cycle of AI hardware expenditures. ASML—being the only maker of the extreme ultra-violet lithography tool needed to manufacture next-generation AI chips—held its own by edging up to 0.3 percent even as profit-taking started, giving further evidence of investor confidence toward long-term demand for EUV technology.
Outside of chip stocks, there was upside for companies involved in the construction of AI data centers. Oracle, which is partnering with OpenAI, TikTok and other partners in global data center initiatives, leapt nearly 6 percent, highlighting the wider infrastructure build-out encompassed by this deal. Shares in other Nvidia-linked suppliers in the U.S., such as manufacturers of boards and cooling systems, also edged higher, with market participants expecting the launch of a multi-year procurement cycle.
Broader market implications
This $100 billion deal is described as the largest AI infrastructure project in history; it marks the deployment of systems that are supposed to require power of up to 10 gigawatts—roughly equivalent to the output of four Hoover Dams. But analysts warn that the circular nature of the investment—whereby Nvidia funds OpenAI only to sell its chips—may come under regulatory scrutiny and raises questions concerning competitive access for rival AI developers.
Nevertheless, the momentum is decidedly bullish. Nvidia is now almost immune to the cyclicality of the chip market, having tied its fortunes to the leading AI startup, placing its GPUs as the de facto standard for large-scale AI workloads. Along with Nvidia, other regional bellwethers—ranging from TSMC to ASML and beyond—are seeing their valuations supported by the assurance of forward-looking AI capital expenditure.
A new AI inflection point
Nvidia and OpenAI’s $100 billion partnership is more than a company alliance; it is a fillip toward the next era of AI-driven growth. With chip stocks across the globe broadly rallying, investors are adjusting positions to maximize on a potential exponential compute demand. While risks around valuation, competitive dynamics, and regulatory oversight remain, immediate market reaction clearly sends one message: AI infrastructure is the new frontier, and Nvidia is at its epicenter.
Nvidia’s landmark deal has set off a simultaneous worldwide rally among the semiconductor stocks and heralded a paradigm shift regarding how AI compute shall be provisioned and monetized in the years to come.
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