AMD to invest $10 billion in Taiwan chip industry as AI race with Nvidia heats up

AMD, a US maker of artificial intelligence processors and a rival to the world's most valuable company Nvidia, announced Thursday an investment of more than $10 billion into Taiwan's chip industry.

The company said investments would be made "across the Taiwan ecosystem to expand strategic partnerships and scale advanced packaging capabilities for AI infrastructure".

Taiwan is a powerhouse in the manufacturing of semiconductors used to train and power AI systems, as the home of chip production giants TSMC and Foxconn.

The island's economy soared last year thanks to skyrocketing exports of AI hardware, a sector that is booming worldwide.

AMD -- whose CEO Lisa Su is due to speak on Friday in Taipei -- said in a statement that it was working with firms in Taiwan and elsewhere on advanced computing components that are essential in AI data centres.

The company "is advancing leading-edge silicon, packaging and manufacturing technologies that enable higher performance, greater efficiency and faster deployment of AI systems", it said.

Among the deals announced Thursday was a hardware development partnership with Taiwanese chip packaging and testing provider ASE and its group partner Siliconware Precision Industries (SPIL).

Governments and tech giants worldwide are pouring hundreds of billions of dollars into building new data centres that can power AI tools such as chatbots, image generators and agents that can execute tasks.

Concerns have been raised over the environmental impact of the AI infrastructure boom, and the International Energy Agency projects that electricity consumption from data centres will double by 2030.

Alongside concerns over planet-warming carbon emissions are worries about water use to cool the data centre servers, which can lead to shortages on hot days.