Nvidia has signed a multi-year agreement worth US$1.5 billion with Amkor Technology to expand advanced semiconductor packaging and test capacity in the United States, the companies announced July 23. The deal underscores a growing industry recognition that packaging, not just silicon fabrication, has become a critical bottleneck for next-generation AI hardware.
Under the agreement, Nvidia will prepay for advanced packaging and testing services spanning high-density interconnects and heterogeneous integration, the technique of combining multiple specialized silicon dies, processors, memory, and networking, into a single package. Amkor already packages Nvidia’s data center GPUs, networking chipsets, and accelerated computing systems; the new agreement formalizes and dramatically expands that relationship.
The geographic dimension is central to the deal. Amkor will expand its advanced packaging operations in Arizona, adding US capacity to a manufacturing footprint that has historically been concentrated in Asia. Nvidia’s Debora Shoquist, Executive Vice President of Operations, described the investment as part of a broader push to “reinvigorate American manufacturing and supply chains” for AI infrastructure.
Advanced packaging has become a strategic bottleneck as AI chip designs grow more complex. Simply shrinking transistors, the traditional Moore’s Law path, no longer delivers the performance gains AI workloads demand. Instead, chipmakers are linking multiple specialized dies through dense interconnects, a technique that requires packaging capabilities distinct from standard fabrication. TSMC, Samsung, and Amkor dominate this market, with the vast majority of capacity in Taiwan and South Korea.
For Nvidia, the deal secures access to packaging capacity that is becoming as strategically important as foundry capacity. For Amkor, it locks in the industry’s largest AI chip customer with a long-term commitment. Kevin Engel, Amkor’s CEO, called the partnership a validation of “the central role advanced packaging plays in enabling the future of AI.”
The agreement spans both US and Asian facilities, allowing Amkor to link technology development with manufacturing scale across geographies. Specific capacity targets for the Arizona expansion were not disclosed.
Sources: Nvidia commits $1.5 billion to expand US capacity for next-gen chip packaging (Interesting Engineering, Jul 23, 2026); Nvidia signs $1.5B accord with Amkor (Bloomberg, Jul 23, 2026); Nvidia, Amkor strike $1.5B chip packaging deal (Reuters, Jul 23, 2026)