What about Nvidia... Even Apple Announces Development of Its Own AI Chip

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Apple is reportedly developing its own chip designed to run artificial intelligence (AI) software on data center servers. The competition among the Nasdaq's top five big tech companies to develop their own AI chips is expected to intensify. Nvidia, which virtually monopolizes the AI chip sector, is finding it difficult to ‘manage its image.’

On the 6th (local time), The Wall Street Journal (WSJ), citing sources familiar with the matter, reported that Apple has been working on an internal project codenamed ‘ACDC’ for several years to develop AI chips for data centers. WSJ stated, “The chip Apple is developing appears to focus on running (inference of) AI models.”

WSJ added that it is uncertain whether Apple will reveal the AI chip or when it might do so. However, there is anticipation that related AI announcements could be made at Apple’s annual Worldwide Developers Conference (WWDC) next month.

Amid the competition among major big tech companies to develop their own AI chips to avoid dependence on Nvidia, this is the first time news of Apple’s entry has emerged. Despite the AI-driven restructuring of the industry ecosystem, Apple has faced criticism for not releasing related products or services, being considered “closer to a value stock than a tech stock.” Bloomberg reported that Microsoft (MS), Amazon, Alphabet (Google’s parent company), and Meta Platforms are building data centers running on their own chips.

Apple has relatively strong chip development capabilities compared to other big tech companies, having incorporated its own chips into devices like the iPhone and Mac. WSJ analyzed that the success of Apple’s AI chip development could become a significant strength for the company. Taiwan’s TSMC is identified as Apple’s manufacturing partner for its AI chips.

Since major big tech companies account for a large portion of Nvidia’s revenue, the fact that all five Nasdaq big tech firms are developing their own AI chips is a negative factor for Nvidia. Generative AI systems, such as large language models (LLMs), require processing enormous amounts of data through data centers, making high-performance graphics processing units (GPUs) essential. Until now, Nvidia has held over 80% of this market.

Major foreign media have highlighted the weakening of Intel’s dominance when the industry ecosystem shifted to the mobile era in 2010 due to major clients developing their own chips, suggesting pessimistically that Nvidia could face a similar fate.

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