Cisco and Vast Data Expand AI Partnership: A Potential Shift in AI Chip Demand?
San Jose, Wednesday, 4 June 2025.
Vast Data and Cisco deepen their collaboration, offering an AI infrastructure solution that integrates Vast’s AI OS with Cisco’s platforms. This partnership aims to streamline AI system deployment through unified data pipelines and infrastructure automation. The increased accessibility and scalability of AI applications could impact the demand for NVIDIA’s AI chips, as the collaboration seeks to create a more accessible ‘AI factory’ for enterprises. NVIDIA’s stock still saw a rise, closing up 2.8%.
Strategic partnership details
The expanded partnership makes Vast’s AI Operating System (OS) directly accessible via Cisco’s Global Price List (GPL) [6][7]. This integration allows customers to procure and deploy Vast AI OS with Cisco UCS servers, Nexus switching, and Cisco Nexus Hyperfabric AI [7]. The collaboration provides a platform for building enterprise AI factories, integrating AI execution, data, and compute services [6]. Vast’s InsightEngine and AgentEngine will run on Cisco UCS as part of the integrated AI execution [6]. The partnership aims to streamline infrastructure provisioning and management using Cisco Nexus Hyperfabric AI [6].
Statements from leadership
Jeremy Foster, Senior Vice President and General Manager at Cisco Compute, stated that Cisco and Vast share a vision of making AI infrastructure accessible, secure, and scalable for every enterprise [6][7]. Renen Hallak, Founder and CEO at Vast Data, noted the partnership represents the convergence of two best-in-class platforms to create a foundational blueprint for enterprise AI [6][7]. Hallak added that aligning the Vast AI OS with Cisco’s infrastructure delivers the simplicity, observability, and scalability enterprises need to manage intelligent systems globally [7].
Potential impact on nvidia
The Cisco-Vast Data partnership focuses on simplifying AI infrastructure, potentially intensifying competition in the AI chip market [1]. By creating a more accessible AI development environment, the partnership could reduce reliance on NVIDIA’s proprietary solutions [1]. This shift aligns with broader industry trends, including efforts to track NVIDIA chip positioning to combat smuggling to China, and the development of alternative AI chips by companies like Huawei [2]. While NVIDIA’s stock saw a slight increase, these competitive pressures could affect its future market position [1].
Industry trends and competition
NVIDIA faces increasing competition from multiple fronts. Huawei is reportedly providing AI chip clusters to Chinese customers with performance exceeding NVIDIA’s [2]. SoftBank and Intel are collaborating on new AI memory chips designed to reduce power consumption by approximately 50% [4][5]. GlobalFoundries is investing $16 billion to expand semiconductor manufacturing and AI development in the U.S., partnering with major companies like Apple and AMD [3]. These developments indicate a diversifying landscape in AI hardware, potentially challenging NVIDIA’s dominance [3][4][5].
Expert perspectives and market dynamics
Despite a fund manager’s view that NVIDIA stock is “overhyped,” the company continues to innovate, assisting Google in designing quantum computing chips [2]. However, NVIDIA’s top AI chips have faced potential supply delays [2]. The U.S. Treasury Secretary has stated that trade negotiations between the U.S. and China have stalled, adding uncertainty to the global chip market [2]. These factors, combined with the Cisco-Vast Data partnership, suggest a complex and evolving market environment for NVIDIA, requiring the company to navigate competition and geopolitical challenges [1][2].