Nvidia to produce AI servers worth up to $658b in US over four years

SANTA CLARA, California – Nvidia said it is planning to build artificial intelligence (AI) servers worth as much as US$500 billion (S$658 billion) in the US over the next four years with help from partners such as Taiwan Semiconductor Manufacturing Co (TSMC), the latest American tech firm to back the Trump administration’s push for local manufacturing.

The April 14 announcement includes production of its Blackwell AI chips at TSMC’s factory in Phoenix, Arizona, and supercomputer manufacturing plants in Texas by Foxconn and Wistron that are expected to ramp up in 12 to 15 months.

The move aligns the AI chip giant, the majority of whose processors are made in Taiwan, with a clutch of tech firms that have pledged to bring manufacturing back to the US amid threats of steep tariffs from President Donald Trump.

D.A. Davidson analyst Gil Luria said: “It is unlikely Nvidia would have moved any production to the US if it was not for pressure from the Trump administration.”

He added: “The half a trillion number is likely hyperbole, in the same way Apple made a half a trillion promise.”

Apple, which assembles most of its iPhones in China, in February promised half a trillion dollars in US investments in the next four years, including a factory in Texas for AI servers.

Nvidia’s announcement comes just hours after the US exempted electronics such as smartphones and chips from its reciprocal tariffs on China, but said it would be announcing the tariff rate on imported chips over the next week.

The exemptions indicate an increasing awareness within the Trump administration of the pain that the tariffs could inflict on inflation-weary consumers, as well as the booming AI industry that relies on chip-related tools from China and Taiwan.

Nvidia chief executive Jensen Huang on April 14 said: “Adding American manufacturing helps us better meet the incredible and growing demand for AI chips and supercomputers, strengthens our supply chain and boosts our resiliency.”

Manufacturing AI chips and supercomputers in the US will create hundreds of thousands of jobs in the coming decades, Nvidia said.

“The reason they did it is because of the election on November 5, and because of the thing called tariffs,” Mr Trump said on Nvidia’s announcement during a briefing in the White House.

Mr Huang in March said Nvidia sees little short-term impact from higher US tariffs, but would move production to the US in the longer term, without giving a timeline.

The company said on April 14 that TSMC has started the production of its latest generation of chips at its Arizona factory. REUTERS