Nvidia Licenses Groq Chip Tech, Hires CEO in Deal Shift

Nvidia has agreed to license chip technology from artificial intelligence startup Groq and hire its CEO, underscoring a growing trend in which large technology companies secure talent and intellectual property through licensing arrangements rather than full acquisitions. Groq said in a blog post on Wednesday that Nvidia will receive a non-exclusive license to its chip technology.

As part of the deal, Groq founder Jonathan Ross, a former Google engineer who played a key role in launching Alphabet’s AI chip program, will join Nvidia, along with Groq President Sunny Madra and several members of the company’s engineering team.

Groq said it will continue to operate as an independent company, with Simon Edwards serving as CEO, and that its cloud business will remain active. This follows media speculation around a potential acquisition: CNBC reported that Nvidia had agreed to acquire Groq for US$20 billion in cash, but neither company confirmed the report.

The agreement highlights Nvidia’s interest in strengthening its position in AI inference, the stage of artificial intelligence deployment in which trained models generate responses to user queries. Nvidia dominates the market for training AI models but faces growing competition in inference from rivals such as Advanced Micro Devices and startups including Groq and Cerebras Systems.

Groq focuses on inference chips that rely on on-chip static random-access memory, or SRAM, rather than high-bandwidth external memory. This architectural approach helps sidestep industry-wide memory constraints and can significantly accelerate response times, but it also limits the size of AI models that can be deployed.

Groq more than doubled its valuation from US$2.8 billion to US$6.9 billion between August and September, following a US$750 million funding round. The company and Cerebras, its main rival using a similar architecture, have signed large commercial agreements in the Middle East. Cerebras plans to pursue an initial public offering as early as next year, according to Reuters.

The Nvidia–Groq deal mirrors other high-profile arrangements in the sector, reflecting a broader shift toward talent-driven partnerships. Microsoft hired its top AI executive through a US$650 million licensing agreement with a startup, while Meta spent US$15 billion to bring in the CEO of Scale AI without acquiring the company. Amazon and Nvidia have also hired founders from AI startups through similar structures. While these transactions have attracted regulatory scrutiny, none have been formally blocked to date.

“The main risk would appear to be antitrust,” Bernstein analyst Stacy Rasgon wrote in a note to clients, adding that structuring the deal as a non-exclusive license may preserve the appearance of competition even as key Groq executives transition to Nvidia.