Nvidia reported on Friday that it will provide more than 260,000 of its AI chips to South Korean firms, and the government would be a part of a major sovereign AI drive.
At a meeting of APEC Summit in South Korea, Nvidia talked about a bunch of separate deals with both the government and private companies.
Amongst the companies, including Samsung, SK Group, Hyundai, and NAVER Cloud, which are four of the biggest companies in the country.
Nvidia stated that these deals would bring the total number of its AI chips used in South Korea to more than 300,000 from the country’s current 65,000 chips.
Nvidia had not commented on the value of the deals or the exact time frames.
The top AI chipmaker added that this initiative was part of South Korea’s drive for AI sovereignty. Sovereign AI is known as to the expansion movements by the countries throughout the world to transform their domestic AI infrastructure and models to make it technologically independent.
Nvidia added that in June, it forecasts the so-called sovereign AI market to expand to $1.5 trillion in the coming years. The recent information from the previous year reveals that South Korea follows a slight of high-profile sovereign AI agreements for Nvidia in the UAE, Saudi Arabia, Europe, and the UK.
At the time of the second quarter earnings report in August, Nvidia indicated that those sovereign AI agreements might contribute more than $20 billion to fiscal year revenue in 2026.
Nvidia’s drive in initiating such a type of agreement comes as the US-China trade conflict has impacted and defeated the leading chipmaker’s booming business in China.
D.A. Davidson analyst Gil Luria informed that sovereign AI is significant to Nvidia as it fuels a worldwide AI infrastructure construction, and holds it critical to the growth of the company.
He said, “Before this year, China made up as much as 25% of Nvidia’s market. Without China, Nvidia would need to expand the rest of its international business in order to continue to develop the market for AI data center equipment.”
Nvidia’s growth in South Korea, the technological company Samsung, the multinational conglomerate SK Group, and automaker Hyundai reported on Friday that they are constructing different AI factories, which will have 50,000 GPUs (graphics processing units, or AI chips) each.
South Korea’s equivalent of Amazon Web Services, NAVER Cloud, Google Cloud, and Microsoft Azure also significant IT partners of the country’s government, are likely to expand their AI infrastructure with 60,000 GPUs.
However, the South Korean Ministry of Science and ICT plans to acquire more than 50,000 Nvidia chips in the coming years, through its national AI computing center and collaborations with companies like NHN Cloud and NAVER Cloud. The South Korean government is likely to use Nvidia’s software to transform its sovereign AI models.
In a briefing with reporters, Nvidia’s vice president of sales and marketing for the Asia-Pacific region, Raymond Teh, said the agreements will “help companies and local organizations build a sovereign AI cloud in their own country.”
The factory of Hyundai has partnered with Blackwell GPUs to be used to evolve its autonomous driving and robotics mechanisms. SK Group subsidiary SK Telecom to utilize the conglomerate’s new pool of Nvidia chips to expand South Korea’s industrial AI cloud infrastructure in Asia.
A massive subsidiary of SK Group, SK Hynix, and Samsung to utilize AI systems of Nvidia to enhance their chip design and manufacturing mechanisms.
SK Hynix remains the biggest supplier of memory chips for AI systems, alongside Nvidia, with US-based Micron. Therefore, Samsung also delivers memory to Nvidia.
In the five trading sessions on Thursday, Nvidia shares rose by 11 percent, and the chipmaker became the first firm to witness its market capitalization surpass $5 trillion at the beginning of this week.
Nvidia is about to announce the agreements in South Korea on Friday, a day later, U.S. President Donald Trump had a meeting with Chinese President Xi Jinping over high-stakes trading discussions in the nation.
Nvidia CEO Jensen Huang has asserted that the Trump administration to emphasize its business in China and praised the president at the speech on Tuesday, where the executive has declared a sovereign AI project with the Department of Energy in the US.
