(Bloomberg) -- Hon Hai Precision Industry Co. plans to boost server capacity to meet stronger-than-anticipated demand for Nvidia Corp. chips used to develop AI, reflecting its expectations that spending on artificial intelligence will stay high.

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Chairman Young Liu told Bloomberg Television that demand for the next-generation Blackwell chips was “crazy,” echoing similar remarks from Nvidia Chief Executive Officer Jensen Huang last week.

The Taiwanese company is now building the world’s largest assembly plant for servers housing Nvidia’s most advanced Grace Blackwell chips in Mexico. Hon Hai will have a planned capacity of 20,000 GB200 NVL 72 servers in 2025, according to Liu, disclosing its scale for the first time.

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“There was a lot of talk that the need for compute may be saturated pretty soon. But it looks like the demand is still growing. So that’s beyond our expectations,” Liu said.

However, Liu said there was a “hiccup” in the production of GB200 servers, confirming again a delay with Blackwell supply. Shipments are now expected to start in the late fourth quarter instead of early in the October-December period, he said.

Still, Nvidia’s Chief Financial Officer Colette Kress said in August that the company expects to ship several billion dollars worth of Blackwell chips in its fiscal fourth quarter.

--With assistance from Lauren Faith Lau.

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