NVIDIA Invests $2B and Partners with Synopsys
NVIDIA has invested $2 billion in Synopsys, part of a partnership to push GPU usage into even more corners of industry.
The investment comes in the form of flat-out purchasing of stock at $414.79 per share. Synopsys shares rose about 20% on the news today (December 1).
Buy, Build … or Invest?
We’ve often seen large companies spend boatloads of cash on acquisitions (think Cisco). NVIDIA has spent the last few months applying a different strategy: buying stock to make investments in incumbent players, possibly to nudge their work toward a more NVIDIA-centric future.
In September, NVIDIA bought $5 billion in Intel stock. A month later, NVIDIA announced a $1 billion stake in Nokia. These deals gave NVIDIA only a small stake in each company: 4% of Intel, and less than 3% of Nokia and Synopsys.
Synopsys is more esoteric than those two examples. It’s a giant in electronic design automation (EDA)—the software used to design chips. While NVIDIA dabbles in design automation, it would make no sense for the company to develop its own EDA software on a large scale, just as it would make no sense for NVIDIA to build its own semiconductor fabs. But it makes a world of sense for NVIDIA to steer EDA development toward its own needs.
Broad Collaboration
The partnership, which is not exclusive for either company, centers around furthering the adoption of GPU-driven engineering work. This isn’t solely about AI, and it goes beyond just chip design; Synopsys offers design software applicable to verticals including automotive and medical. NVIDIA, of course, has a vested interest in making GPUs even more applicable to that kind of work.
The companies will collaborate on encouraging more use of digital-twin technologies for design, test, and validation. They’ll also work to make GPU-accelerated engineering in the cloud more accessible “to engineering teams of all sizes.”
The partnership also extends into Synopsys’ own products. Synopsys’ AgentEngineer applies AI agents to design automation, helping engineers automate simple steps and ultimately aiding them in planning and decision making. The plan is to integrate that with the NVIDIA Agentic AI technology stack.
NVIDIA Under Fire
NVIDIA’s status as kingpin is continually under fire, a natural market reaction to a dominant company. We’ve written recently about AMD’s escalating ambitions and hyperscalers prioritizing their own AI chips. The Information has previously reported that Google is pitching its TPUs to other clouds; last week, it added that Google is talking to Meta and others about using TPUs in-house.
None of this dooms or even dents NVIDIA. It makes sense for the company to continue exploiting its market dominance by steering more of the supply chain in its favor. On the surface, the Synopsys deal also gives NVIDIA a lever to make GPUs even more useful in more industries.
