Why Nvidia is spending billions to replace copper with glass
Nvidia is replacing copper with glass and writing a cheque worth up to US$3.2bn to do it.
According to CNBC, the chipmaker announced a multiyear partnership with glassmaker Corning on Wednesday to build three new optical manufacturing facilities in North Carolina and Texas, sending Corning shares up as much as 19 percent and Nvidia stock up nearly 6 percent.
Nvidia received warrants to buy up to 15m Corning shares at US$180 each — above Tuesday's close of US$162.10 — plus a pre-funded warrant for up to 3m additional shares worth US$500m.
Broader financial terms were not disclosed.
The deal centres on co-packaged optics, which swaps copper cables for optical glass fibres inside AI rack-scale systems, CNBC reported.
The technology promises faster data transfers and lower energy consumption — something analysts have tracked for years.
The companies said in a joint press release that under the partnership, Corning will increase its US optical connectivity manufacturing capacity tenfold and expand domestic fibre production by more than 50 percent, creating more than 3,000 jobs across the two states.
Nvidia CEO Jensen Huang, who called co-packaged optics essential for the AI build-out at GTC last year, said the Corning deal was about "inventing the future of computing with advanced optical technologies — building the foundation for AI infrastructure where intelligence moves at the speed of light."
Corning chairman and CEO Wendell Weeks said the deal proved AI was "not just a technology story" but a manufacturing one playing out in the US.
The two companies have each risen alongside the broader AI infrastructure wave that took off after OpenAI launched ChatGPT in 2022.
Nvidia's graphics processing units power the large language models that companies like Alphabet and Meta use to scale their data centres, CNBC reported.
Its stock has climbed roughly 14-fold over five years, though the pace has slowed as investors spread exposure across Intel, Micron, and now Corning.
Corning, a 175-year-old company that invented optical fibre for long-range communication in 1970, has supplied millions of miles of cable to AI data centres run by major tech players.
Though widely known for Apple's iPhone display glass, optical communications is now its largest and fastest-growing business.
Its stock has climbed more than 300 percent over the past year, though Reuters noted that weaker demand in non-optical segments like consumer electronics glass has weighed on its broader outlook.
CNBC reported that the Nvidia deal follows Meta's January announcement that it would spend up to US$6bn to expand Corning's optical cable plant in Hickory, North Carolina — a project expected to add around 1,000 jobs,
The Nvidia partnership covers three entirely new facilities.
Corning also raised its long-term sales targets on Wednesday, telling Reuters it expects a US$20bn annualised sales run rate by year-end, rising to US$30bn by end of 2028 and US$40bn by end of 2030.
