Nvidia has entered into a licensing agreement with AI chip startup Groq, acquiring rights to the company’s inference technology. According to investor Alex Davis, whose firm Disruptive led Groq’s recent funding round, the deal is valued at approximately $20 billion in cash, making it Nvidia’s largest acquisition to date.
The agreement includes the transfer of Groq’s assets to Nvidia, though financial terms were not officially disclosed by either company. Groq founder and CEO Jonathan Ross, along with President Sunny Madra and other senior team members, will join Nvidia to help integrate and scale the licensed technology.
Ross previously worked at Google, where he helped develop the Tensor Processing Unit, a custom chip designed as an alternative to Nvidia’s graphics processing units. He founded Groq in 2016 with other former Google engineers.
Groq will continue operating independently under new CEO Simon Edwards, who previously served as the company’s finance chief. The company’s GroqCloud business will remain operational and was not included in the transaction.
Groq raised $750 million three months before the deal at a valuation of $6.9 billion. Investors included BlackRock, Neuberger Berman, Samsung, and Cisco. The startup specializes in low-latency processors designed for AI inference tasks.
Nvidia CEO Jensen Huang stated in an employee email that the company plans to integrate Groq’s processors into its AI factory architecture to serve a broader range of inference and real-time workloads. The deal follows a similar pattern to Nvidia’s September transaction with Enfabrica, where it spent over $900 million to license technology and hire key employees.
