Nvidia Partners with Former Rival to Consolidate AI Chip Market

Nvidia's acquisition of Groq's technology and talent has taken an unexpected turn. Instead of competing, Nvidia is now partnering with the surviving entity to put its systems in data centers.

This move eliminates some competition for Nvidia, according to analysts, who say it's a strategic approach to fending off competition. 'This makes the original Groq transaction look even more strategic,' said Brad Gastwirth, global head of research and market intelligence at Circular Technology.

Groq, which remained independent after its deal with Nvidia, has seen significant growth since then. In June, it announced a $650 million funding round. Now, by partnering with Nvidia, Groq's AI cloud service can access Nvidia technology alongside its own language processing units (LPUs).