Nvidia’s physical AI effort sparks Asian partners to rally

issued Sunday, May 3, 2026 · 12:17 PM

[SINGAPORE] The list of Asian stocks that would benefit from a business partnership with Nvidia is growing as the region becomes more integrated into the artificial intelligence chip giant’s business ecosystem.

In the last week alone, South Korea’s LG Electronics, Taiwan’s Nanya Technology, and China’s Huizhou Desay SV Automotive and Pateo Connect Technology Shanghai have all made headlines with news of partnerships, supply chain participation, or product cooperation with American chip designers.

Investor enthusiasm for these companies, some of which are relatively unknown outside their industry and domestic markets, is a reminder of how Nvidia-induced demand is shaping stock price performance across Asia’s technology supply chain.

Asian suppliers now account for about 90% of Nvidia’s production costs, up from about 65% last year, according to data compiled by Bloomberg. Explosive growth in chip designers’ products has increased their dependence on Asian partners for control of manufacturing, assembly and key components.

“It is inevitable that global high-tech companies like Nvidia will become increasingly reliant on Asian supply chains,” said Lynn Beisern, managing director of Union Bancare Privy. Physical AI “could add to the already surging demand for AI chips from Asian supply chains,” he added.

Nvidia has expanded its roster of partners in Asia in recent years, primarily through strengthening chip-focused relationships with suppliers such as SK Hynix and Samsung Electronics. While these alliances are focused on expanding the computing power of AI, the recent wave of alliances in the region signals a shift beyond semiconductors to physical AI, including robotics.

Shares of LG Electronics rose as much as 15% on Tuesday (April 28), the biggest intraday gain since February 11, following domestic media reports that the company and Nvidia will discuss plans to integrate home robots with the US chip designer’s platform.

In Taiwan, Nanya Technology shares rose 10% after local news reports about a partnership between the chipmaker and Nvidia.

Elsewhere, shares of China’s Huizhou Decai rose after announcing a new mass-produced intelligent driving solution with Nvidia, and shares of auto products maker Patheo Connect Technology soared after the company signed a series of partnerships with Nvidia.

An LG Electronics spokesperson said the company can confirm that it recently held talks with Nvidia, adding that the two companies are exploring strategic cooperation in physical AI, including the robotics ecosystem.

A representative for Samsung Electronics declined to comment in response to questions from Bloomberg. Nanya said in an email response that it does not comment on customer-related information.

Expanding demand

With its physical AI efforts spanning robotics, autonomous systems, and AI-enabled manufacturing, Nvidia is extending its influence beyond chips to real-world deployments and positioning Asia as a key partner in that expansion. CEO Jensen Huang positions physical AI as the next wave of generative AI.

“As the world continues to build out AI, demand growth and expansion are creating opportunities for more high-tech suppliers to join supply chains across industries,” said Marvin Chen, strategist at Bloomberg Intelligence. “This means that high-tech North Asian markets are likely to continue to outperform.”

The latest capital spending guidance from US tech giants shows that AI spending is accelerating, with Amazon.com, Microsoft and Alphabet each committing about US$190 billion to US$200 billion this year, and Meta Platforms taking its spending up to US$145 billion.

Nvidia accounts for about half of Microsoft’s capital spending, about a quarter of Amazon’s capital spending, and smaller but still leading shares at Meta and Alphabet, based on calculations of data compiled by Bloomberg.

Meanwhile, Honghai has consistently been a secondary beneficiary, particularly at Microsoft and Amazon, and SK Hynix has a mid-single-digit share of the company overall.

The surge in demand is reflected in the performance of these suppliers. Samsung’s semiconductor division exceeded expectations last week, with profits jumping 48 times. A few days ago, SK Hynix reported a 5x increase in quarterly profit.

“Asia’s technology base is a key structural advantage, especially as AI creates new demand across semiconductors, components, servers and broader hardware infrastructure,” said Rajeev de Mello, portfolio manager at Gama Asset Management.

“Asia has already developed significant experience and supply chains for building advanced semiconductors and robots, which is a strong foundation for implementing physical AI.”Bloomberg