US chip-packaging company Amkor Technology said on July 23 it signed a multi-year US$1.5 billion agreement with Nvidia.

The deal will expand advanced semiconductor packaging and testing capacity in the US, including Arizona, amid demand for AI infrastructure.

Nvidia will make a prepayment to support the expansion. The companies will jointly develop packaging and testing technologies for Nvidia’s AI and accelerated-computing platforms.

The deal comes as advanced packaging capacity for AI chips remains in short supply.

Advanced packaging combines different types of chips in a single package to improve performance.

The agreement builds on Amkor’s Peoria campus, a 104-acre site for advanced packaging and testing backed by up to US$407 million in funding under the US CHIPS Act.

It also follows Amkor’s 10-year partnership with TSMC to expand US advanced packaging capacity, including in Arizona.

The deal also fits Nvidia’s US manufacturing plan after the company said Blackwell chip production had started in Phoenix and that it was working with Amkor and SPIL on packaging and testing in Arizona.

Amkor shares rose 17% in extended trading after the announcement.

🔗 Source: Reuters