Nvidia expands AI empire with Groq tech and talent grab

San Francisco – Nvidia has agreed to license chip technology from start-up Groq and hire its chief executive, a veteran of Alphabet’s Google, Groq said in a blog post on Dec 24.

The deal follows a familiar pattern in recent years in which the world’s biggest technology firms pay large sums to promising start-ups in return for their technology and talent but stop short of formally acquiring the target.

Groq specialises in what is known as inference, where artificial intelligence (AI) models that have already been trained respond to requests from users. While Nvidia dominates the market for training AI models, it faces much more competition in inference, where traditional rivals such as Advanced Micro Devices have aimed to challenge it, as well as start-ups such as Groq and Cerebras Systems.

Nvidia has agreed to a “non-exclusive” licence to Groq’s technology, Groq said. It said its founder Jonathan Ross, who helped Google start its AI chip programme, as well as Groq president Sunny Madra and other members of its engineering team, will join Nvidia.

Groq did not disclose financial details of the deal. CNBC reported that Nvidia had agreed to acquire Groq for US$20 billion (S$25.7 billion) in cash, but neither Nvidia nor Groq commented on the report. 

Groq said in its blog post that it will continue to operate as an independent company with Mr Simon Edwards as CEO and that its cloud business will continue operating.

In similar recent deals, Microsoft’s top AI executive came through

a US$650 million deal with a start-up

that was billed as a licensing fee, and 

Meta spent US$15 billion to hire Scale AI’s CEO

without acquiring the entire firm. Amazon hired away founders from Adept AI, and Nvidia did a similar deal in 2025. The deals have faced scrutiny by regulators, though none has yet been unwound.

“Antitrust would seem to be the primary risk here, though structuring the deal as a non-exclusive licence may keep the fiction of competition alive (even as Groq’s leadership and, we would presume, technical talent move over to Nvidia),” Bernstein analyst Stacy Rasgon wrote in a note to clients on Dec 23 after Groq‘s announcement. Nvidia CEO Jensen Huang’s “relationship with the Trump administration appears to be among the strongest of the key US tech companies”.

Groq more than doubled its valuation to US$6.9 billion from US$2.8 billion in August 2024, following a US$750 million funding round in September.

Groq is one of a number of upstarts that do not use external high-bandwidth memory chips, freeing them from the memory crunch affecting the global chip industry. The approach, which uses a form of on-chip memory called SRAM, helps speed up interactions with chatbots and other AI models but limits the size of the model that can be served.

Groq’s primary rival in the approach is Cerebras Systems, which Reuters in December reported plans to go public as soon as 2026. Groq and Cerebras have signed large deals in the Middle East.

Nvidia’s Mr Huang spent much of his biggest keynote speech of 2025 arguing that Nvidia would be able to maintain its lead as AI markets shift from training to inference. REUTERS