Nvidia shares edged lower in early Monday trading following a report that suggested OpenAI, the Microsoft-backed creator of ChaptGPT, is looking to design its own AI-powering chips as it plans its next phase of expansion.

Making a high-performance processor in-house will be a bargaining chip as the AI giant buys from NVIDIA, Reuters said.

OpenAI remains on track to start producing its in-house AI chip next year, according to a report from Reuters. Sources tell the outlet that OpenAI plans to finalize its design over the next few months before sending it to the Taiwan Semiconductor Manufacturing Co (TSMC) for fabrication.

Microsoft-backed OpenAI (MSFT), the maker of ChatGPT, is looking to reduce its reliance on chipmaker Nvidia (NVDA) by developing its first

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The ChatGPT maker is finalising the design for its first in-house chip in the next few months and plans to send it for fabrication at Taiwan Semiconductor Manufacturing Co, sources told Reuters. The process of sending a first design through a chip factory is called "taping out."

A new report suggests OpenAI is in the process of developing its first in-house AI chip, for early production with TSMC in 2025. The Latest Tech News, Delivered to Your Inbox

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TSMC will be manufacturing OpenAI’s in-house chip using the chipmaker’s advanced 3-nanometer process technology.

As the industry embraces artificial intelligence, the need for chips ready for AI tasks has increased considerably in recent