By Liz Napolitano
Publication Date: 2025-12-29 16:57:00
Nvidia has considerable room to run after spending billions of dollars on assets from artificial intelligence accelerator chipmaker Groq — a deal that analysts think can give its graphics-processing units an edge over competitors. Groq announced its $20 billion “non-exclusive licensing agreement” with Nvidia on Wednesday, marking the largest such deal in the semiconductor manufacturer’s 32-year history. Under the agreement, Groq CEO Jonathan Ross, president Sunny Madra and other members of Groq’s core engineering team will join the AI giant. Nvidia will also tap the startup’s inference technology, which offers high throughput and low latency for running large language models and other AI workloads. By gaining access to top talent and technology, Nvidia is positioning itself to become more competitive in the AI chip market, particularly as Google attempts to push its tensor-processing units for large-scale AI training, according to Truist analysts. “We view this as a move by NVDA to bolster its competitive positioning in inference, specifically versus the TPU,” Truist analyst William Stein said last Friday in a note to clients. He noted that, “because Groq’s leadership formerly worked on the TPU project, we believe Groq’s LPU architecture is likely similar to that of the TPU and designed for better latency and energy performance in large scale inference.” Truist has a $275 price target on shares, implying 44.3% upside from Friday’s close. Nvidia has rallied 39% this…