Washington: Nvidia has agreed to license chip technology from artificial intelligence startup Groq and hire its founder and chief executive, Jonathan Ross, in a deal that underscores the intensifying competition in AI inference chips. Groq disclosed the agreement in a blog post on Wednesday, while a person familiar with the matter confirmed the licensing arrangement.
The deal reflects a growing trend in which large technology companies strike licensing and talent-hiring agreements with startups rather than pursuing full acquisitions. Such structures allow incumbents to absorb critical technology and expertise while avoiding the regulatory scrutiny that often accompanies outright takeovers.
Groq focuses on AI inference—running trained models to respond to user queries—a segment where Nvidia faces stiffer competition than in AI training, a market it currently dominates. Rivals in inference include AMD as well as startups such as Groq and Cerebras Systems.
Under the agreement, Nvidia will receive a non-exclusive license to Groq’s technology. Along with Ross, Groq president Sunny Madra and several members of the company’s engineering team will also join Nvidia. Ross previously played a key role in launching Google’s in-house AI chip programme during his tenure at Alphabet.
Groq did not disclose the financial terms of the deal. It also said it would continue to operate as an independent company, with Simon Edwards taking over as chief executive, and that its cloud services business would remain active. CNBC reported that Nvidia had agreed to acquire Groq for $20 billion in cash, but neither Nvidia nor Groq commented on the report.
Similar arrangements have become common across the technology sector. Microsoft hired a leading AI executive through a $650 million licensing-style deal, Meta spent about $15 billion to bring in Scale AI’s CEO, and Amazon recruited founders from Adept AI.
Nvidia itself has executed comparable transactions in the past. While regulators have scrutinised these deals, none has been reversed so far.
Analysts note that antitrust considerations remain the primary risk, even when transactions are structured as non-exclusive licenses.
Bernstein analyst Stacy Rasgon said such deals preserve the appearance of competition, despite key leadership and technical talent moving to larger firms.
Groq’s valuation more than doubled to $6.9 billion after a $750 million funding round in September. It uses on-chip SRAM instead of high-bandwidth memory to speed inference, though this limits
model size.