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Cryptopolitan 2025-12-24 22:00:51

Nvidia bought Groq for $20 billion in cash, making it its largest acquisition ever

Nvidia just dropped $20 billion in cash to buy Groq, a chip startup that builds hardware for artificial intelligence. This is Nvidia’s biggest deal ever, beating its 2019 Mellanox purchase by nearly triple. That one was worth around $7 billion. This one comes in cash, straight from Nvidia’s growing $60.6 billion pile of cash and short-term investments. That pile was just $13.3 billion in early 2023. Now they’re spending it. Groq builds high-performance chips to run large language models faster. Their hardware helps these models complete inference tasks quickly. The company was not even up for sale when Nvidia reached out, but the deal came together fast. Alex Davis, CEO of Disruptive, the lead investor in Groq’s most recent round, said things moved quickly. Disruptive has put over $500 million into Groq since its founding in 2016. Groq raised billions before selling and left its cloud unit behind Three months ago, Groq raised $750 million at a $6.9 billion valuation. That round had big names like Blackrock, Neuberger Berman, Samsung, Cisco, Altimeter, and 1789 Capital, where Donald Trump Jr. is a partner. And now Nvidia is buying the entire company for nearly three times that valuation. Groq is expected to inform its investors later today. But Davis said not everything is included. Nvidia is buying all of Groq’s assets, except for one thing; Groq Cloud, the company’s new cloud division. That’s staying behind and isn’t part of the purchase. The rest, though, is going under Nvidia’s belt. Groq is aiming to hit $500 million in revenue this year, thanks to insane global demand for chips that power AI is real and growing. Groq’s technology has apparently been helping companies speed up how fast AI models answer prompts and make decisions. That kind of tech is hot right now, and Nvidia clearly wanted in. Founders came from Google, and Musk had something to say Groq was founded by engineers who left Google, including CEO Jonathan Ross. He helped build Google’s Tensor Processing Unit (TPU), custom chips used by some companies instead of Nvidia’s chips. Ross and Douglas Wightman, another ex-Google engineer, were listed in Groq’s first SEC filing in 2016 when they raised $10.3 million. Wightman worked at Google’s experimental lab, Google X. Nvidia has been throwing money at the whole AI ecosystem lately. It invested in Cohere, a company building AI models, and Crusoe, which mixes AI with energy infrastructure. Nvidia also put more into CoreWeave, a cloud platform focused on AI that’s preparing for an IPO. Back in September, Nvidia also said it wanted to invest up to $100 billion in OpenAI. OpenAI, in return, would have to use at least 10 gigawatts of Nvidia’s hardware. That deal still hasn’t been finalized. In the same month, Nvidia said it would invest $5 billion in Intel under a separate agreement. Other chip startups have been moving too. Cerebras Systems, another company in the AI space, had planned to go public this year. But in October, it backed out after raising over $1 billion in private funding. Meanwhile, Mr. Elon Musk, who owns AI startup xAI, posted on X that, “xAI will have more AI compute than everyone else combined in Want your project in front of crypto’s top minds? Feature it in our next industry report, where data meets impact.

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