Nvidia (NASDAQ:NVDA) and Cisco Systems (NASDAQ:CSCO) announced on Tuesday they have joined forces to simplify the process for companies to create their AI computing setups, aiming to extend the technology’s reach beyond major data center operators.
Specifically, the collaboration will see Cisco integrating Nvidia's AI-focused hardware, renowned for AI model development, with its own networking solutions.
Cisco’s shares rose 0.7% on Tuesday while NVDA fell 1.6%.
This partnership not only provides Nvidia with a new avenue to distribute its technology but also allows Cisco to tap into the surging demand for AI, which has propelled Nvidia to become the top-valued chipmaker globally.
“Working closely with Cisco, we’re making it easier than ever for enterprises to obtain the infrastructure they need to benefit from AI, the most powerful technology force of our lifetime,” Nvidia CEO Jensen Huang said in a statement.
Cisco plans to market M7 server computers powered by Nvidia's advanced processors, complemented by Nvidia's software, AI models, and development tools, in addition to Cisco's cloud software and services for system management and oversight.
Commenting on the partnership, Citi analysts said:
“We continue to view ANET as the incumbent AI data center switch provider and do not see any change to their position in light of this announcement.”