Artificial Intelligence (AI) computing giant NVIDIA has agreed to license chip technology from startup Groq and hire away its CEO, a veteran of Alphabet’s Google. The deal follows a recent but familiar pattern, where the world’s biggest technology firms pay large sums in deals with promising startups to take their technology and talent but stop short of formally acquiring the target.
Groq specialises in inference, where artificial intelligence models that have already been trained respond to requests from users. While NVIDIA dominates the market for training AI models, it faces much more competition in inference, where traditional rivals such as Advanced Micro Devices (AMD) have aimed to challenge it as well as upcoming players like Groq and Cerebras Systems.
“NVIDIA has agreed to a ‘non-exclusive’ license to Groq’s technology,” the startup said, while stating its founder, Jonathan Ross, who helped Google start its AI chip programme, as well as Groq President Sunny Madra and other members of its engineering team, will join the AI computing giant.
According to a CNBC report, NVIDIA had agreed to acquire Groq for USD 20 billion in cash. However, none of the companies confirmed the news or commented on it. Groq will continue to operate as an independent company with Simon Edwards as CEO, and its cloud business will continue operating.
“In similar recent deals, Microsoft’s top AI executive came through a USD 650 million deal with a startup that was billed as a licensing fee, and Meta spent USD 15 billion to hire Scale AI’s CEO without acquiring the entire firm. Amazon hired away founders from Adept AI, and NVIDIA did a similar deal in 2025. The deals have faced scrutiny by regulators, though none have yet been unwound,” reported Reuters about this acquisition trend.
“Antitrust would seem to be the primary risk here, though structuring the deal as a non-exclusive license may keep the fiction of competition alive (even as Groq’s leadership and, we would presume, technical talent move over to NVIDIA). And NVIDIA CEO Jensen Huang’s relationship with the Trump administration appears among the strongest of the key US tech companies,” Bernstein analyst Stacy Rasgon wrote in a note to clients after Groq’s announcement.
Groq is one of several upstarts that do not use external high-bandwidth memory chips, a solution that has freed the business from the memory crunch affecting the global chip industry. This particular approach uses a form of on-chip memory called SRAM, which helps speed up interactions with chatbots and other AI models but also limits the size of the model that can be served.
Groq’s primary rival, Cerebras Systems, which is also working on the particular solution, plans to go public in 2026. Groq and Cerebras have signed large deals in the Middle East. Groq’s acquisition reflects CEO Jensen Huang’s 2025 keynote speech, where he emphasised that NVIDIA would maintain its industry lead as AI markets transition from training to inference.