Back in 2019, Nvidia began making its biggest acquisition in the company’s history, reaching “a definitive agreement” to acquire Mellanox for roughly $7 billion. That deal officially completed in late April 2020 and now, Nvidia has fully absorbed Mellanox, renaming it ‘NVIDIA Networking’.
For those out of the loop, Mellanox is one of Nvidia’s biggest acquisitions to date and is just one of several big business moves the company has made in recent years. All of this has contributed to Nvidia’s continued growth and performance on the stock market. In the case of Mellanox, this acquisition bolsters Nvidia’s business in the cloud computing, networking and data centre sectors.
Mellanox specialises in cloud computing, data centres and networking- several areas that Nvidia has been keenly focused on over the years. Combining Mellanox’s networking technology with Nvidia’s computing expertise should enable “higher performance, greater utilisation of computing resources and lower operating costs”.
NVIDIA Networking, formerly known as Mellanox, will reduce Nvidia’s operating costs in these key businesses and lead to higher performance and greater utilisation of computing resources. It is currently unknown if the products released under Mellanox, such as the Mellanox ConnectX 5, will be renamed to include NVIDIA Networking, or if the Mellanox name will continue to be used for product branding.
Nvidia could have another major acquisition up its sleeve for later this year, with rumours indicating that it is a front runner to acquire ARM from the Japanese firm, SoftBank.
KitGuru Says: Renaming Mellanox Technologies as NVIDIA Networking makes perfect sense following the acquisition. Now we’ll just have to wait and see how this impacts Nvidia’s future earnings reports.