In a strategic move that underscores the growing importance of AI hardware, SoftBank has acquired British AI chipmaker Graphcore for approximately $600 million. This acquisition positions SoftBank to enhance its AI capabilities and underscores its commitment to advancing AI technology.
A New Chapter for Graphcore
Graphcore, renowned for its innovative “Intelligence Processing Units” (IPUs) designed specifically for AI workloads, will operate as a wholly-owned subsidiary of SoftBank. The Bristol-based company will maintain its headquarters and existing offices in Cambridge, London, Gdansk, and Hsinchu, ensuring continuity in its operations and preserving its established presence.
Nigel Toon, co-founder and CEO of Graphcore, expressed optimism about the acquisition, stating, “This is a tremendous endorsement of our team and their ability to build truly transformative AI technologies at scale, as well as a great outcome for our company.”
Toon highlighted the ongoing demand for AI compute and the need to improve efficiency, resilience, and computational power to fully realize AI’s potential.
SoftBank’s Vision for AI
SoftBank’s acquisition of Graphcore is part of its broader strategy to invest in next-generation semiconductors and compute systems, which are crucial for the development of Artificial General Intelligence (AGI). Vikas J. Parekh, Managing Partner at SoftBank Investment Advisers, commented on the acquisition, noting, “Society is embracing the opportunities offered by foundation models, generative AI applications, and new approaches to scientific discovery.”
Graphcore has made significant technological advancements, such as outperforming an Nvidia A100 GPU in 2020 and halving the time required for a GPU-based drug discovery workload. Despite these successes, Graphcore has faced financial challenges, reporting a revenue of just $2.7 million in 2022 against operating expenses of $206.8 million.
Implications for the AI Chip Market
The acquisition signals SoftBank’s intent to become a significant player in the competitive AI chip market, currently dominated by companies like NVIDIA, Intel, and AMD. With AI increasingly permeating various sectors, the demand for specialized AI hardware is expected to grow. SoftBank’s integration of Graphcore’s advanced IPUs positions both companies to capitalize on this trend.
The acquisition is also a testament to Graphcore’s role as a leading employer in the UK’s high-tech economy, with continued investment in creating high-skilled jobs across various disciplines.
