Armenia is not a big country. It’s not a wealthy country. It’s not a famous country. And yet, it has become not only a consumer of different AI products akin to Clideo subtitles generator for video editing, or giants like OpenAI, but also entered the headlines of global news for several reasons, not the least of which is politics. Another reason is tech advances, precisely, the alleged ‘manufacturing of chips for NVIDIA’. The latter is a big name, which you surely recognize, so let’s discuss the situation in detail. 

First and foremost, news started circulating that NVIDIA was somehow “making chips in Armenia.” But clarifications are in order. Armenia is not becoming a chip fabrication country in the Taiwan sense. NVIDIA Blackwell chips are not going to be manufactured in Hrazdan or Yerevan; NVIDIA says Blackwell GPUs are manufactured using a custom TSMC 4NP process, which places the core chip-production story firmly inside the existing global semiconductor supply chain, not inside Armenia. 

Armenia is trying to do something else: become a regional AI compute hub, built around imported high-end NVIDIA infrastructure, U.S.-approved chip transfers, local telecom and energy capacity, and a growing argument that smaller countries need sovereign access to AI computing power.

The centerpiece is Firebird, a U.S.-based AI cloud and infrastructure company operating between San Francisco and Yerevan. Armenia’s Ministry of High-Tech Industry says the first phase of the Firebird AI center near Hrazdan is scheduled around 2026 and involves a $500 million investment, more than 6,000 NVIDIA Blackwell GPUs, 18 MW of capacity and up to 110.6 exaflops of FP4 Tensor compute. The government presents the second phase as far larger: approximately $4 billion in total investment and more than 41,000 additional GPUs, a scale that, if delivered as described, would place Armenia unusually high on the global AI-compute map for a country of its size.

Real Story Behind Infrastructure

The confusion is understandable because the word “chips” is everywhere in this story. U.S. export approval was required. NVIDIA Blackwell GPUs are central to the project. Dell Technologies is involved on the server side. The U.S. and Armenia also signed an AI and Semiconductor Innovation Partnership MOU on August 8, 2025, which the U.S. International Trade Administration describes as covering secure semiconductor supply chains, integrated-circuit and electronics development, AI commercialization and Armenia’s position under the U.S. export-control framework. That sounds close to “chip production,” but it is not the same thing as building fabrication plants. In practical terms, Armenia’s emerging role is closer to AI infrastructure, cloud services, electronics/IC development, engineering talent and semiconductor-adjacent R&D than mass semiconductor manufacturing.

Moreover, NVIDIA now frames major AI infrastructure as AI factories, i.e., systems that manufacture intelligence rather than physical goods. Its GB300 NVL72 platform, for example, is a rack-scale system combining 72 Blackwell Ultra GPUs and 36 Arm-based Grace CPUs in a liquid-cooled architecture designed for training and inference at very high density. Dell, one of the infrastructure partners in this broader market, describes its PowerEdge XE9712 with NVIDIA GB300 NVL72 as a rack-scale enterprise AI platform, built for high-output reasoning inference and improved throughput. In other words, Armenia’s project is not about making the chip; it is about hosting the machines that make large-scale AI development possible.

Independent regional reporting supports this reading. Eurasianet reported in November 2025 that U.S. regulators approved the transfer of advanced NVIDIA chips for Armenia’s AI hub, while also noting Dell’s PowerEdge server role and the political importance of the approval process. OC Media, citing Bloomberg, reported that the project involves a 100 MW data center using NVIDIA Blackwell chips and Dell AI servers, with the first phase expected in 2026. OC Media also reported that part of the significance lies in export controls: Armenia had previously been affected by U.S. restrictions on exports of high-performance AI chips to certain countries, making approval a strategic as well as commercial milestone.

Why Armenia Wants AI Compute So Badly

For Armenia, the strategic logic is clear. The country already has a serious technology base relative to its size, especially in software engineering, mathematics, electronic design automation and diaspora-connected entrepreneurship. Synopsys Armenia, for example, describes its local operation as covering R&D and product support for electronic design automation, design for manufacturing and semiconductor IP, with more than 1,000 employees across Yerevan and Gyumri. That does not make Armenia a chip-manufacturing giant, but it does mean the country has long been more connected to the semiconductor value chain than casual observers may assume.

The Firebird project attempts to add a missing layer: massive compute. Talent without computers becomes dependent on foreign cloud providers. Research without GPUs remains theoretical. Startups without local access to advanced infrastructure may build around someone else’s platform, pricing and policy limits. That is why the phrase “compute sovereignty” fits the Armenian case better than “chip production.” The argument is not that Armenia can replace existing semiconductor powers. The argument is that access to AI infrastructure is becoming a national development issue, the way broadband, energy grids and transport corridors once were.

There is also a public-sector AI layer. Armenia has signed a cooperation agreement with Mistral AI, and Mistral’s own customer page says the partnership with Armenia’s Ministry of High-Tech Industry focuses on AI assistants, public services and government functions, with attention to open and adaptable models that fit Armenia’s language, infrastructure and use cases. That makes the country’s AI push less like a single data-center announcement and more like a broader attempt to connect infrastructure, public services, startups, universities and international partnerships.

The Hard Part Comes After the Announcement

However, there are obstacles on the way. The factories of AI require a massive amount of energy, capital and are politically charged. A 100 MW data centre would consume as much electricity as a city of around 120,000 people, and could consume significant cooling capacity, but Armenia’s Ministry of High-Tech Industry claims that the Firebird centre is fitted out with a closed loop water-cooling system that only requires a water change every few years. This is the case of Armenia’s own energy situation: U.S. International Trade Administration reports that Armenia has an adequate current electricity generating capacity with rising consumption and is still relying on a combination of nuclear, hydro and thermal generation.

There is also a risk of execution. Firebird is young, the capital figures are big, the gap between an AI factory that has been announced and is fully leveraging and an AI compute hub that is fully utilized and commercially viable is huge. The project will require customers, a reliable power supply, cooling, network resiliency, export-control stability, and operational expertise and a local ecosystem that can absorb a part of the compute capacity. The Ministry reports that Team Telecom Armenia is installing next-generation fiber-optic infrastructure with up to 1 Tbps bandwidth, while according to OC Media, the project could include some portion of compute which would be allocated to domestic companies and the remaining compute that would be sold to U.S.-based companies operating in the region. What’s important about those details is that usage of the GPUs will impact local benefit – who will be getting them, at what price, and for what type of work. 

The most accurate way to describe Armenia’s AI moment, then, is not “NVIDIA is producing chips in Armenia.” It is this: Armenia is trying to turn advanced imported chips into domestic strategic capacity. If Firebird, Dell, NVIDIA-linked infrastructure, U.S. export approvals, local telecom investment and public-sector AI partnerships come together as planned, Armenia could become one of the more unusual AI infrastructure stories of the next few years: a small, landlocked country using computers as a development strategy. The gamble is bold. Armenia is not trying to become the next chip fab. It is trying to become a place where the next generation of AI systems can be trained, hosted and commercialized.