Nvidia Corp., a leading supplier of artificial intelligence (AI) chips, is strengthening its collaboration with Cisco Systems Inc. to simplify AI infrastructure for businesses. The expanded partnership aims to address challenges that many companies face when integrating AI into their data centers, the companies announced Tuesday.
About Nvidia Cisco’s AI Partnership
As enterprises strive to implement AI technologies, they often encounter obstacles due to the complexity of transitioning their existing systems. To overcome these barriers, Cisco and Nvidia are increasing the number of products that incorporate each other’s technology, ensuring smoother AI adoption for corporate customers.
A key element of Nvidia’s AI networking suite, Spectrum-X Ethernet, will now include Cisco’s connectivity-focused chips, broadening its capabilities. Cisco CEO Chuck Robbins emphasized the need for enterprises to deploy AI efficiently while managing costs and risks. “Enterprises are under immense pressure to deploy AI quickly and effectively, and many leaders struggle to justify the investment while balancing the risks,” Robbins said.
The announcement had a positive impact on Cisco’s stock, which rose as much as 2.2% to $64.64 in New York trading. This increase contrasted with a general downturn in the technology sector on Tuesday. The AI chip company shares, however, saw a slight decline, falling less than 1% to $129.44.
Potential Impact On Both Companies
Traditionally, large-scale AI infrastructure development has been dominated by major technology firms such as Microsoft Corp. and Amazon.com Inc.—companies known as hyperscalers, which have extensive engineering resources. Nvidia’s strategy now involves extending AI capabilities beyond these industry giants to a wider range of enterprises, including government agencies and corporations that rely on Cisco’s networking solutions.
Cisco has historically struggled to gain traction in hyperscaler data centers, where competitors like Broadcom Inc. dominate. By partnering with Nvidia, Cisco aims to capture a greater share of AI-driven technology spending. The integration of Cisco’s Silicon One chips into Nvidia’s networking products is expected to enhance competitiveness against Broadcom’s widely used alternatives.
This latest collaboration builds on an existing relationship between the two companies, which first announced their AI-focused partnership last year. The move is part of Nvidia’s broader effort to drive AI adoption across industries, making the technology more accessible to a diverse range of enterprises.
Source: https://finance.yahoo.com/news/nvidia-cisco-extend-partnership-aimed-124000376.html
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