By Faizan Farooque
Publication Date: 2026-01-02 15:02:00
This article first appeared on GuruFocus.
Nvidia Corp. (NVDA, Financials) has acquired AI chip startup Groq in a $20 billion deal, gaining access to proprietary inference technology and talent as the company strengthens its leadership in AI hardware.
The transaction, which was announced on December 24, comprises Groq’s key employees and core assets. People know Groq for making inference accelerators that work very well for AI workloads. The partnership was set up as a non-exclusive license agreement that included complete ownership of intellectual property and the
merging of the teams.The move comes as more and more people want specialized AI silicon, especially for activities that need low latency and high efficiency. Groq’s specialized inference architecture adds to Nvidia’s supremacy in AI training with its H100 and H200 GPUs.
After the news came out, an analyst at The Quantamental Investor raised Nvidia’s rating to “Buy,” saying that the company’s long-term position and value were better aligned with its growth expectations. The purchase should make Nvidia’s end-to end AI platform stronger and help it gain more market share in both cloud and business deployments.
Investors will be looking for signs of how the Groq transaction will fit into Nvidia’s product pipeline and help the business make money in its next earnings report and future forecasts.
