Nvidia (NVDA) has entered into a non-exclusive licensing agreement with Groq for its inference technology. The agreement reflects a shared focus on expanding access to high-performance, low cost inference.
As part of the agreement, Groq’s Founder Jonathan Ross, President Sunny Madra and other members of the Groq team will join Nvidia to help advance and scale the licensed technology. Groq will continue to operate as an independent company, with Simon Edwards stepping into the role of Chief Executive Officer.
GroqCloud will continue to operate without interruption.
Groq, a pioneer in AI inference, announced $750 million in new financing at a post-money valuation of $6.9 billion in September. The round was led by Disruptive, with significant participation from Blackrock, Neuberger Berman, DTCP and a large US-based West Coast mutual fund manager. The raise also included continued support from Samsung, Cisco, D1, Altimeter, 1789 Capital and Infinitum.
Groq has been targeting revenue of $500 million this year amid booming demand for AI accelerator chips used in speeding up the process for large language models to complete inference-related tasks.
Groq was founded in 2016 by a group of former engineers, including Ross. He was one of the creators of Google’s tensor processing unit, or TPU, the search giant’s custom chip that’s being used by some companies as an alternative to Nvidia’s graphics processing units.
CNBC reported that Nvidia is acquiring assets from Groq for $20 billion. Alex Davis, CEO of Disruptive, told CNBC that Nvidia is getting all of Groq’s assets, though its nascent Groq cloud business is not part of the transaction.
If the figures are correct, the deal would represent by far Nvidia’s largest acquisition ever. The chipmaker’s biggest acquisition to date occurred in 2019, when it acquired Israeli chip designer Mellanox for nearly $7 billion.