Nvidia partner announces price hike amid increased workload due to AI boom
Nvidia's Taiwanese partner in the AI supercomputer project has been forced to increase costs due to increased pressure on the supply chain - and will now "adjust" its prices
The strain created on supply chains due to increased demand for AI has prompted the chipmaker to "adjust" prices / Photo: g0d4ather / Shutterstock
MediaTek - one of the largest Taiwanese companies, which along with TSMC is engaged in the development and production of chips - announced that the sharp increase in demand for AI applications, overloading the supply chain and increasing costs, writes Reuters. Because of this, MediaTek warned, the company will be forced to "adjust" its own prices. MediaTek's partners include Nvidia, Reuters recalls.
Details
The statements came from MediaTek CEO Rick Tsai during a quarterly conference call with investors. After reporting strong business growth thanks to the AI boom, Tsai said he was confident about the company's prospects. "AI is acting as a catalyst for industry expansion and spurring demand growth, but the global supply chain faces challenges in fully meeting increased demand in 2026," Tsai noted, emphasizing that the emerging situation is driving up costs "across the board."
"We will also adjust [MediaTek's] pricing policy to take into account the rising costs in the supply chain and will allocate product volumes among the lines based on overall profitability," Tsai said. He did not disclose details about these plans.
By 2027, MediaTek expects to generate "several billion dollars in revenue" from AI-accelerated ASICs, the company's CEO confirmed the estimates he announced last October. According to Tsai, the total addressable ASIC chip market for data centers is now estimated at $50-70 billion - about $20 billion higher than the previous forecast.
MediaTek shares closed February 4 in Taiwan up 0.3% ahead of the reporting. They have gained 26% YTD, significantly outperforming the 11.5% rise in Taiwan's benchmark Taiex Stock Index (TWII).
Context
MediaTek has partnered with Nvidia since 2025 - together the companies are working on the GB10 Grace Blackwell superchip used in the DGX Spark, Nvidia's personal AI supercomputer that went on sale last year, Reuters explains.
Tsai, who attended Nvidia CEO Jensen Huang's reception with Taiwanese suppliers in Taipei on Saturday, Jan. 31, said MediaTek is seeing "very positive feedback" on the DGX Spark and expects the company's revenue growth to accelerate in 2026.
On Wednesday, February 4, MediaTek reported fourth-quarter 2025 revenue of NT$150.2 billion ($4.76 billion), up 8.8% from a year earlier. Net income, meanwhile, fell 3.6% to NT$23.1 billion.
This article was AI-translated and verified by a human editor
