NVIDIA has been front-running supplier deals since shortages began, but according to BusinessKorea, the AI giant has a rather 'interesting' tactic for securing agreements.

The AI supply chain is not only one of the most complex but also involves players sought out by the world's largest manufacturers, such as NVIDIA, AMD, and others. And the AI industry has been a 'buyer-dominated' market for several years now, especially in segments like HBM, where, for NVIDIA and others, the idea is to secure optimal arrangements that focus on the best capacity and pricing. BusinessKorea that Team Green has employed a negotiation policy focused on a "pre-emptive pressure tactic" against suppliers like Samsung and TSMC, and apparently, it has worked out.

It is claimed that NVIDIA's inspection team paid a visit to Samsung's Pyeongtaek Campus, which is known to be one of the firm's most advanced semiconductor lines and is currently responsible for HBM processes. The NVIDIA team had conducted an "internal audit", where it is reported that they had an unusual attitude towards the Korean giant's operations, and that the team was involved in "extremely high-level" criticism regarding technical details. The report also claims that the recent audit differed from previous ones because the validation standards were set 'too high'.

While NVIDIA or Samsung hasn't officially confirmed this incident, BusinessKorea says that this is one of the tactics Team Green employs before discussing contract pricing, and the idea here is to gain leverage by highlighting "minor vulnerabilities". The inspection likely comes at a time when both parties are involved in securing HBM4 contracts for the volume production of Vera Rubin , and it's also important to note that this contract will be a major milestone for the Korean giant as well, considering the company's sluggish momentum with the HBM business in the past.

The report also claims that SK hynix and TSMC have also been a victim of NVIDIA 'unusual' scrunity in the past as well, which is why this isn't something surprising for suppliers. One could argue that Team Green has set strict qualification standards for its partners, and it couldn't afford to compromise on even the smallest stages of production, since ultimately, any negative development could compound into something much larger for NVIDIA and its business. And for suppliers, not complying with Team Green also leads to financial troubles that are simply unaffordable.

We have reached out to NVIDIA and Samsung for a statement.

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