Nvidia Acquires Mellanox for $6.9 Billion to Expand Data Center Business

- Advertisement -

In an attempt to expand its data center business, GPU maker Nvidia has closed the deal to acquire Israeli Data center Networking firm Mellanox in an all-cash deal valued at $6.9 billion.  Many analysts and experts believe that Nvidia managed to beat rival and fellow American chip-manufacturer Intel in the buyout.

33% of Nvidia’s total revenue is sourced from data centers and the acquisition of Mellanox will make it the biggest vendor in the industry. Mellanox, based in Israel and the United States, primarily deals in the manufacture of chips and other necessary hardware that goes in a data center server, which in-turn powers cloud computing. The technology used by Mellanox has played a crucial role in the transfer of data between components, within and between computers. Their chips are used in both Summit and Siera supercomputers, which are powered by Nvidia’s GPUs. Consequently, it will further strengthen Nvidia’s claim of having unrivaled solutions to process data for artificial intelligence.

NVIDIA CEO Jensen Huang
Nvidia CEO Jensen Huang is credited to accelerate the company’s performance in the past, but the cryptocurrency haywire has started to slow down its performance. Picture: CNBC

“The emergence of AI and data science, as well as billions of simultaneous computer users, is fueling skyrocketing demand on the world’s datacenters,” said Jensen Huang, founder and CEO of NVIDIA. “Addressing this demand will require holistic architectures that connect vast numbers of fast computing nodes over intelligent networking fabrics to form a giant datacenter-scale compute engine.

- Advertisement -

Stacy Rasgon, who serves as an analyst at Bernstein says that the successful acquisition of Mellanox will further enunciate Nvidia’s cause of venturing more into network solutions by equipping them with their Mellanox’s expertise.

The semiconductor industry, which amounts to a mammoth $470 billion, has been showing signs of consolidation since 2014, owing to increasing costs and lessened demands.

However, this deal could face the backlash of the trade war between the U.S. and China, as the Trump administration has previously been blocking deals like these. The chip industry is fractured by this standoff as America is the largest producer of chips and China is the biggest consumer. This deal made the Mellanox shares rise by more than 8 percent and the Nvidia shares rose by 4 percent on Monday.

- Advertisement -

Further Reading:

AMD Radeon VII being sold at $100 over MSRP on Newegg

- Advertisement -

Anthem Review: A Bare-bones Destiny Clone Without a Soul

NVIDIA GeForce GTX 1660 EVGA and Gigabyte AIB Cards Pictured


- Advertisement -


Please enter your comment!
Please enter your name here

Related posts

Latest posts

7 Indian App Alternatives to Popular Foreign Ones

JioPages Browser instead of UC Browser  Most of the times,UC Browser comes pre-installed with Chinese phones and was developed by the internet company UCWeb, a...

Micromax In 1 Review: Stock Android Saves The Day

After a long vacation, Micromax returned to the Indian smartphone industry with two 'In' series smartphones. Both were considerably good on paper, quite different...

Outriders Review – Gears of War, But As An RPG-Looter-Shooter?

What do you get when you combine Gears of War and Destiny? Outriders is the latest looter-shooter that follows a little too close to formula.

Next Article Loading