Nvidia has invested $2 billion in chip designer software maker Synopsys. This is part of an expanded multi-year tie-up to jointly develop new tools for designing products across industries using its AI technology.
The deal was announced by the companies on Monday. According to Reuters, this deal is about shifting the work of several high-tech industries that are just starting to adopt AI away from central processing units used in the past and toward the graphics processing unit chips sold by Nvidia. Synopsys software is widely used in designing everything from computer chips to jet engines. Engineers use its tools to simulate those designs virtually in computers before committing to expensive prototype manufacturing.
CEOs of the two companies said in a press conference that the simulations can take weeks, but could be sped up to a few hours using Nvidia’s chips. “CUDA GPU-accelerated computing is revolutionizing design — enabling simulation at unprecedented speed and scale, from atoms to transistors, from chips to complete systems, creating fully functional digital twins inside the computer,” said Jensen Huang, founder and CEO of Nvidia.
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“Our partnership with Synopsys harnesses the power of NVIDIA accelerated computing and AI to reimagine engineering and design — empowering engineers to invent the extraordinary products that will shape our future.”
Meanwhile, Sassine Ghazi, president and CEO of Synopsys said “The complexity and cost of developing next-generation intelligent systems demands engineering solutions with a deeper integration of electronics and physics, accelerated by AI capabilities and compute. No two companies are better positioned to deliver AI-powered, holistic system design solutions than Synopsys and NVIDIA. Together we will re-engineer engineering and empower innovators everywhere to more efficiently realize their innovations.”
Ghazi also mentioned that Nvidia cash will give Synopsys “optionality” as it adapts its software for Nvidia chips. “There is no intention or commitment to use that $2 billion to purchase Nvidia GPUs,” Ghazi said during the press conference. “This is something that we do on a normal course of business.”
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The CEOs said that deal is non-exclusive, and Ghazi said Synopsys is open to working with other chipmakers. “If an AMD or an Intel or whichever customer wanting to capture a similar opportunity (approaches Synopsys), it’s not exclusive. We’re willing and happy to work with them,” Ghazi said. Synopsys shares were up nearly 5%, while Nvidia was up 1.4%.
Nvidia, which is now the world’s most valuable company, had invested billions of dollars this year in the booming AI industry. These deals range from as much as a $100 billion investment in OpenAI, to a $5 billion stake in Intel. Nvidia bought Synopsys’s common stock at $414.79 per share, the companies said on Monday, representing a discount of about 0.8% to the stock’s last closing price on Friday.