Tech Explained: Here’s a simplified explanation of the latest technology update around Tech Explained: Nvidia to license Groq AI chip tech, hire CEO in Simple Termsand what it means for users..
Nvidia has agreed to license artificial intelligence chip technology from startup Groq and hire several of its top executives, including its chief executive officer, in a deal that reflects a growing trend among major technology companies to acquire talent and intellectual property without pursuing full takeovers.
Groq said on Wednesday that Nvidia would take a non-exclusive licence to its chip technology, which is designed for AI inference — the process by which trained artificial intelligence models respond to user queries. Nvidia also plans to bring Groq founder Jonathan Ross, Groq President Sunny Madra and other senior engineers into the company, News.Az reports, citing Reuters.
Ross is a veteran of Alphabet’s Google and played a key role in launching Google’s in-house AI chip programme.
A source familiar with the matter confirmed the licensing agreement. Financial details were not disclosed. Groq denied reports suggesting Nvidia had agreed to acquire the company outright for $20bn, saying it would continue operating independently under new CEO Simon Edwards and maintain its cloud business.
Nvidia dominates the market for training large AI models but faces growing competition in inference, where rivals such as Advanced Micro Devices (AMD) and startups including Groq and Cerebras Systems are seeking to gain ground.
Groq specialises in inference chips that rely on on-chip SRAM memory rather than external high-bandwidth memory, allowing for faster responses in chatbots and AI applications, though with limits on model size.
The deal mirrors a broader pattern in the tech industry. In recent years, companies such as Microsoft, Meta and Amazon have spent billions on licensing arrangements or executive hires from AI startups rather than full acquisitions — a strategy that can help avoid regulatory scrutiny while still securing critical expertise.
Analysts noted that antitrust concerns remain a key risk, although the non-exclusive structure of the Groq licence may reduce regulatory pressure. Nvidia CEO Jensen Huang has also been seen as maintaining strong ties with the current US administration.
Groq more than doubled its valuation to $6.9bn following a $750m funding round in September, underscoring investor confidence in alternatives to Nvidia’s dominant AI hardware.
Nvidia has repeatedly said it expects the AI market to increasingly shift from model training toward inference, a transition that makes access to specialised inference technology and experienced talent strategically critical.
News.Az