Nvidia’s Plan B: Jensen Huang Reveals Backup Strategy if TSMC Faces Geopolitical Challenges

Nvidia CEO Jensen Huang recently discussed the partnership with Taiwan’s semiconductor manufacturer (TSMC), hinting that he could utilize other foundries as necessary. 

Business Insider reported that Huang addressed the precarious situation due to rising tensions in the Taiwan Strait during a discussion with David M. Solomon, the CEO of Goldman Sachs Group, Inc. Huang acknowledged the challenge when asked how he views the geopolitical situation, given that most supply chain partners are in Asia, particularly Taiwan. He said, “If TSMC were compromised, supply would continue—though it wouldn’t be as good.”

Huang further explained that NVIDIA has enough intellectual property to move from one fab to another if necessary, indicating that he could leverage foundries other than TSMC when needed. He elaborated, “We won’t be able to get the same level of performance or cost. But we will be able to provide a supply.” He further stated that should any issues arise, they should be able to produce elsewhere.

Despite these comments, Huang reiterated that TSMC remains the world’s leading chip manufacturer by a significant margin. Last month, in a filing with the U.S. Securities and Exchange Commission, NVIDIA emphasized TSMC’s importance while also stating that it’s working to enhance the resilience and diversification of our supply chain. The filing also noted that new export controls or changes could restrict alternative manufacturing locations and negatively impact NVIDIA’s business.

Meanwhile, NVIDIA dominates the global AI chip market with an 80% share as a fabless company. The company manufactures its flagship Hopper and next-generation Blackwell series chips through Taiwan’s TSMC.