OpenAI and Taiwanese technology giant Foxconn unveiled a new partnership on Friday to co-design and produce AI data-center hardware, deepening the US chatbot developer’s rapid expansion into physical infrastructure.

Under the agreement, Foxconn will manufacture the specialized systems at its facilities in the United States. OpenAI will gain early access to test the hardware and retain the option to purchase it once finalized.

The collaboration comes amid a global shortage of advanced AI infrastructure, as demand continues to exceed available supply. “Demand for critical components in AI infrastructure is already far outpacing supply, and we expect that will only continue,” OpenAI chief executive Sam Altman said via video at a Foxconn event in Taipei.

OpenAI has committed an estimated $1 trillion to infrastructure partnerships in 2025 alone, including a $300 billion deal with Oracle and the $500 billion Stargate initiative with Oracle and Japan’s SoftBank.

Foxconn—also known as Hon Hai—has seen profits climb as it pivots from lower-margin iPhone assembly toward high-growth AI server production. Investor enthusiasm for AI has driven tech valuations higher, though it has also fueled concerns of a market bubble and contributed to recent market swings.

In a separate announcement Friday, Foxconn and Intrinsic, a robotics company under Alphabet, said they would jointly develop and deploy advanced robotics systems across Foxconn’s U.S. operations, though financial terms were not disclosed.

Bloomberg Intelligence analyst Steven Tseng noted that Foxconn has been expanding its U.S. footprint as a major supplier of AI servers and networking equipment. A formal partnership with OpenAI, he said, “is a strong validation that Foxconn is now firmly among the leaders in AI infrastructure build-out.”

Tseng added that geopolitical tensions—including the risk of a Chinese invasion of democratic Taiwan—have pushed many AI server manufacturers to shift production to the United States, despite higher costs. Still, he said, Hon Hai’s scale, vertical integration, and long experience in server manufacturing should help it navigate any pressure on profit margins.