Nvidia acquired AI chip startup Groq for approximately $20 billion in cash, marking its largest acquisition to date.

On December 25th, CNBC reported that Groq, a high-performance AI accelerator chip design company, is about to be acquired by Nvidia for $20 billion in cash.

This news was revealed by Davis, CEO of Disruptive, a long-term investor in Groq. Since Groq's founding in 2016, Disruptive has invested over $500 million in the company. Davis stated that the acquisition negotiations progressed rapidly, with both parties reaching an agreement in a short period.

Groq reportedly plans to formally inform its investors of the transaction later on Wednesday.

While the acquisition covers the vast majority of Groq's assets, its early-stage cloud business is not included in the deal. If the acquisition is successfully completed, it will be the largest acquisition in Nvidia's history, significantly surpassing its nearly $7 billion acquisition of Israeli chipmaker Mellanox in 2019.

In recent years, Groq, focusing on AI accelerator chips, has experienced significant growth due to the explosive growth in demand for large language model inference tasks. The company's revenue target for this year is approximately $500 million, reflecting strong market demand for its high-performance inference hardware.

If this acquisition goes through, it will further solidify Nvidia's dominant position in AI computing and may reshape the competitive landscape of the high-end AI chip market. Industry observers believe that through this acquisition, Nvidia not only strengthens its chip portfolio but also gains access to Groq's key technological capabilities in low-latency, high-throughput inference acceleration, helping it maintain its leading position in the increasingly fierce AI hardware competition. (Source: BLOCKBEATS)