Samsung has won a contract to supply South Korean cloud and search company Naver with $752 million worth of its upcoming Mach-1 AI accelerator chips.

According to a report from the Korea Economic Daily, the new contract with Samsung will allow Naver to significantly reduce its reliance on Nvidia AI chips, which are currently expensive and in short supply.

Samsung is expected to provide Naver with between 150,000 and 200,000 AI chips at a cost of around $3,756 a unit. The cloud company will use the chips for AI inference in its servers that power its AI map service, Naver Place.

The Mach-1 AI accelerator is Samsung first AI chip, and combines the company’s processors and low-power DRAM chips. This means it is different to Nvidia’s accelerators, which consist of GPUs and HBM chips. In addition to reportedly being one-tenth of the cost of Nvidia’s hardware, the Mach-1 is said to have fewer data bottlenecks and consume less power, and Samsung claims it can improve efficiency by up to eight times.

Samsung is also reportedly in talks to supply chips to Microsoft and Meta. A prototype of the Mach-1 will be in production by the end of the year, with the product expected to ship in 2025.

Earlier this month, Nvidia unveiled its new Blackwell GPU architecture, which it says will allow customers to build and run real-time trillion-parameter large language models at 25x less cost and energy consumption than its predecessor, the Hopper series. The Blackwell architecture is set to launch later in 2024.