Samsung Electro-Mechanics, LG Innotek Expand AI Partnerships with Nvidia

Samsung Electro-Mechanics' Busan manufacturing facility in South Korea. The company has agreed to jointly invest with Nvidia in expanding dedicated production capacity for advanced AI semiconductor package substrates at its Sejong and Busan facilities. Nvidia is expanding its strategic partnerships with South Korean electronic components makers Samsung Electro-Mechanics and LG Innotek to secure a stable supply of artificial intelligence (AI) semiconductor substrates and strengthen its robotics ecosystem. The collaborations aim to address shortages in semiconductor package substrate capacity while jointly developing vision sensing solutions for humanoid robots, reinforcing Nvidia's position in emerging AI markets. According to industry sources on Oct. 22, Nvidia recently announced the partnerships at GTC Berlin, a technology event held in Germany. Under its agreement with Samsung Electro-Mechanics, the companies will establish dedicated production lines for Nvidia's semiconductor package substrates at Samsung Electro-Mechanics' facilities in Sejong and Busan to support the expansion of next-generation AI infrastructure. The arrangement involves joint investment by both companies to expand manufacturing capacity, marking an unusually close form of cooperation. Under the multi-year partnership, Samsung Electro-Mechanics will begin supplying Nvidia with package substrates for AI semiconductors this year. The products covered by the agreement include substrates for Nvidia's computing chips and networking switch chips, which support ultra-high-speed data transmission within data centers. Nvidia plans to increase production capacity for substrates used in its products to 2.5 times the current level over the next three years, with Samsung Electro-Mechanics serving as a key partner in its expanding global supply chain. Samsung Electro-Mechanics' revenue exposure to Nvidia is expected to rise sharply as investment in the dedicated production facilities progresses. Supply volumes for Nvidia in its package substrate business are projected to record double-digit average annual growth, with Nvidia expected to account for a substantial share of the company's total package substrate production capacity by 2028. "We will combine our advanced manufacturing capabilities and differentiated technologies to serve as a total solutions provider, ensuring the timely delivery of Nvidia's AI platforms to the market," said Chang Duck-hyun, CEO of Samsung Electro-Mechanics. LG Innotek, meanwhile, is strengthening its partnership with Nvidia in robot sensing as it prepares for the era of physical AI. At GTC Berlin, the company unveiled a lineup of sensing solutions incorporating Nvidia's proprietary HoloScan Sensor Bridge (HSB) technology. HSB enables data collected by sensors to be transmitted directly to an AI computer without passing through a central processing unit (CPU), significantly accelerating data processing. The two companies plan to expand their collaboration on HSB-based solutions, including vision sensing systems and robotic hands for humanoid robots. They also intend to develop sensing solutions compatible with Nvidia's next-generation platforms and unveil them at CES and GTC next year. "This partnership presents an opportunity to bring our differentiated integrated sensing solutions to global markets," said Moon Hyuk-soo, CEO of LG Innotek. "We intend to move quickly to establish a leading position in the physical AI solutions market." The partnerships highlight the growing technological competitiveness of South Korean component manufacturers in advanced AI applications. AI semiconductor package substrates are typically larger and contain more layers than conventional substrates, making fine-circuit fabrication and warpage control critical to maintaining production yields. By leveraging its advanced manufacturing technologies, Samsung Electro-Mechanics is positioned to expand its presence in the high-value-added substrate market, which has long been dominated by Japanese suppliers such as Ibiden. LG Innotek is also diversifying its business portfolio by extending the optical design expertise it has accumulated in mobile devices and autonomous driving into robotics. As more global companies adopt Nvidia's platforms, opportunities to supply camera modules and sensing solutions are expected to grow. Industry observers view the partnerships as evidence that both South Korean manufacturers are shifting beyond their traditional smartphone and automotive component businesses toward AI infrastructure and robotics.