Graphcore, a UK-based AI chip designer once seen as a potential rival to Nvidia, is now exploring a sale after struggling to capitalize on the AI boom.
Despite substantial funding, including more than $700 million from investors such as Microsoft and Sequoia, the company's revenue fell 46% last year and losses have since widened. The company has been unable to compete with Nvidia's graphics processing units, which have seen increasing demand during the AI revolution.
Rumored potential buyers of Graphcore include British microchip company Arm, Japanese tech conglomerate Softbank (which has a majority stake in Arm), and AI darling OpenAI. However, it is not yet clear how advanced these discussions are on sale.
Run out of cash
Meanwhile, Graphcore continues to engage in separate fundraising talks, seeking new funds to cover its mounting losses. The company has already laid off staff and closed international offices in a bid to cut costs.
Yahoo! Finance says the company's current financial situation indicates it needs to raise more funds before May to stay afloat. This comes after a failed deal with Microsoft, in which the tech giant reportedly initially agreed to use Graphcore chips in its cloud computing systems, but later backed out.
While Graphcore's future remains uncertain, the company's intelligence processing units could be a valuable asset in the rapidly expanding AI market. However, any sale, which could exceed $500 million, will likely be closely scrutinized by national security officials because of the strategic importance of the artificial intelligence technology.
