Nvidia's $20 Billion Groq Deal Fuels Fears of AI Chip Monopoly

Nvidia has agreed to a $20-billion (£15.8 billion) acquisition cash deal with Groq, AI inference pioneer, which includes the latter's assets. In a report by CNBC on 24 December 2025, Disruptive CEO Alex Davis said the deal was swiftly finalised. The non-exclusive licensing deal involves the acquisition of Groq's technology and moving Groq's senior executives to Nvidia.

Groq's specialisation is in 'inference', which is how artificial intelligence responds to user requests. It delivers affordable and highly competent inference, which is referenced by Groq in its website as 'fuel for AI'.

Nvidia is dominating the AI training market with its Graphics Processing Units (GPUs), providing power to data centres for AI worldwide. Together, Nvidia and Groq could potentially scale high-performance chips deployment in data centres across the globe with their combined technology.

Groq's Position

In a blog post on Wednesday, Groq confirmed the deal, referencing it as a 'Non-Exclusive Inference Technology Licensing Agreement' that aims to advance AI inference globally. The announcement said, 'As part of this agreement, Jonathan Ross, Groq's Founder; Sunny Madra, Groq's President; and other members of the Groq team will join Nvidia to help advance and scale the licensed technology'.

The post also announced Simon Edwards assuming the role of Groq's Chief Executive Officer, and said GroqCloud will not be interrupted in the process, and will continue to work.

In September, chip startup Groq raised $750 million (£550 million) in financing, a post-money valuation of $6.9 billion, with Disruptive's leadership in securing backing from Blackrock, Neuberger Berman, DTCP, Samsung, Cisco, D1, Altimeter, and more.

In a September blog post by Groq, its Founder Jonathan Ross explained, 'Inference is defining this era of AI, and we're building the American infrastructure that delivers it with high speed and low cost'. Groq plays a central role in the US AI Stack and is trusted by over two million developers, along with several of the world's Fortune 500 companies.

Monopoly Concerns

Its recent Groq deal highlights Nvidia's potential attempt at AI concentration by leveraging on its financial capacity. As such, this has sparked discussions about its growing influence turning into dominance that could limit competition.

Concerns over monopolizing the market continue to grow alongside Nvidia's investment activities, as other developers might struggle in the AI industry in future. GuruFocus reports that as private equity investments and corporate funds have funded AI primarily, Nvidia has invested $50 billion in over 60 companies in the past two years.

In September 2025, Nvidia announced a partnership with OpenAI. In the official announcement via Nvidia's Newsroom, Nvidia CEO and Founder said, 'NVIDIA and OpenAI have pushed each other for a decade, from the first DGX supercomputer to the breakthrough of ChatGPT'. The partnership, set to 'power the next era of intelligence', involved deploying 10 gigawatts of AI data centres.

While these recent moves cannot be confirmed as Nvidia's effort to monopolise the AI industry, it can be noted that Nvidia's footprint in AI hardware continues to grow, and could potentially curb competition.