This Under-the-Radar Supplier Could Be Nvidia's Secret Weapon
Nvidia's close relationship with SK Hynix benefits both companies.
Overview
The artificial intelligence (AI) infrastructure boom is becoming increasingly about supply bottlenecks. The companies riding these supply constraints and those with access to high-demand components are both positioned to be long-term winners.
One of the biggest bottlenecks in the AI infrastructure market right now is high-bandwidth memory (HBM), and Nvidia's (NASDAQ: NVDA) close relationship with memory maker SK Hynix (NASDAQ: SKHY) provides big upside for both AI stocks.
Details
HBM gets packaged with AI chips, like Nvidia's graphics processing units (GPUs), to reduce latency and optimize performance. Without HBM, GPUs would spend much of their time sitting idle waiting for data to arrive, and power consumption would skyrocket. As such, they are a necessary component that gets stacked alongside a GPU die within the same protective outer package.
Source
Originally published at www.fool.com.