Graphics-chip maker Nvidia on Tuesday announced a strategic partnership with Foxconn, the world's largest contract manufacturer of technology products, to develop automated and autonomous vehicle platforms. NVDA stock dropped with the broader market Tuesday.
Taiwan-based Foxconn, officially called Hon Hai Technology Group, is best known as the manufacturer of Apple iPhones and other devices.
Foxconn will produce electronic control units based on Nvidia technology for the global automotive market. Also, Foxconn-manufactured electric vehicles will feature Nvidia Drive Orin systems and Drive Hyperion sensors for highly automated driving capabilities, the companies said in a news release.
"This strategic cooperation with Nvidia strengthens the intelligent driving solutions Foxconn will be able to provide," Eric Yeh, senior director of the Software Development Center at Foxconn, said in a written statement. "Together, we are enabling the industry to build energy-efficient, automated vehicles."
NVDA Stock Slips
On the stock market today, NVDA stock fell 2.1% to close at 143.15 amid a broad market downturn.
Nvidia made the announcement ahead of the CES 2023 trade show in Las Vegas. This year's conference runs Thursday through Sunday, but preshow media events begin Tuesday.
Nvidia also announced that it will offer its GeForce Now cloud gaming service to several automakers.
Hyundai Motor Group of South Korea, BYD of China, and Polestar of Sweden are the first automakers to work with Nvidia to deliver GeForce Now to their vehicles. Those carmakers plan to offer streamed video games to front-seat passengers when vehicles are parked and to passengers in back seats where screens are available.
Mercedes Using Nvidia Omniverse
In other CES-related news, automaker Mercedes-Benz announced that it is using the Nvidia Omniverse platform to design and plan manufacturing and assembly facilities. Omniverse is Nvidia's take on the metaverse, a concept involving 3D virtual environments.
Also Tuesday, Nvidia announced the latest update to its Omniverse Enterprise offering. The new release delivers enhanced performance and streamlined workflows for teams.
NVDA stock ranks No. 17 out of 34 stocks in IBD's fabless semiconductor industry group, according to IBD Stock Checkup. Further, it has a subpar IBD Composite Rating of 47 out of 99. The Composite Rating scores a stock's key growth metrics against all other stocks regardless of industry group.
NVDA stock has an IBD Relative Strength Rating of 34 out of 99. That also puts it near the bottom third of stocks for performance.
Follow Patrick Seitz on Twitter at @IBD_PSeitz for more stories on consumer technology, software and semiconductor stocks.
