In a significant move to bolster its artificial intelligence (AI) capabilities, Japanese conglomerate SoftBank has acquired British AI chipmaker Graphcore.
The acquisition, valued at approximately $600 million, aims to position SoftBank at the forefront of the AI industry, alongside its other tech investments, including Arm.
Key Takeaways
- SoftBank acquires UK-based AI chipmaker Graphcore for around $600 million.
- Graphcore will continue to operate under its own name and maintain its headquarters in Bristol, UK.
- The acquisition aims to enhance SoftBank's AI capabilities and compete with industry giants like Nvidia.
- Graphcore has struggled financially, reporting significant losses in recent years.
- The deal reflects SoftBank's strategic focus on AI and next-generation technologies.
SoftBank's Strategic Move
SoftBank's acquisition of Graphcore is part of its broader strategy to invest in next-generation technologies. The Japanese tech giant, founded by Masayoshi Son, has been making significant investments in AI, including its earlier acquisition of UK-based chip designer Arm. This latest move is seen as a step to strengthen its position in the AI chip market.
Graphcore's Challenges and Opportunities
Graphcore, founded in 2016, has been recognised for its innovative "Intelligence Processing Units" designed for AI workloads. Despite its technological advancements, the company has faced financial difficulties, reporting just $2.7 million in sales and $205 million in pre-tax losses in 2022. The acquisition by SoftBank is expected to provide the necessary resources to scale and compete with industry leaders like Nvidia and AMD.
Future Prospects
With SoftBank's backing, Graphcore aims to expand its operations and enhance its product offerings. The company will continue to operate from its headquarters in Bristol and retain its offices in Cambridge, London, Gdansk, and Hsinchu. The acquisition is expected to create high-skilled jobs and drive innovation in the AI chip industry.
Regulatory Approvals and Market Impact
The deal has received the required regulatory approvals in the UK and US, as well as national security clearance from the British government. The acquisition is seen as a positive development for the UK tech industry, providing a boost to the AI sector and potentially attracting more investments.
Conclusion
SoftBank's acquisition of Graphcore underscores its commitment to advancing AI technologies and competing in the global AI chip market. With the financial backing and strategic support from SoftBank, Graphcore is well-positioned to overcome its financial challenges and drive innovation in the AI industry.
Sources
- SoftBank buys UK chipmaker Graphcore in AI push, Financial Times.
- Pound nears one-year high; Japan’s SoftBank buys UK chipmaker Graphcore – as it happened | Business | The Guardian, The Guardian.
- SoftBank buys struggling UK AI chipmaker Graphcore • The Register, The Register.
- SoftBank acquires British AI chipmaker Graphcore, AI News.
- British AI chipmaker Graphcore acquired by Japan's Softbank | This is Money, This is Money.
