SoftBank Group has acquired British artificial intelligence chip manufacturer Graphcore for an undisclosed amount, marking a significant move in the AI technology sector. Graphcore, known for its Intelligent Processing Units (IPUs), will now operate as a wholly-owned subsidiary of SoftBank.
Graphcore’s market capitalization peaked at $2.8 billion in 2020 following substantial investments. However, the company has faced significant financial challenges recently. In 2022, Graphcore reported a pre-tax loss of $205 million and sales of just $2.7 million. These difficulties have been attributed to the broader economic environment, which has dampened demand for hardware sales.
In response to these challenges, Graphcore has closed branches in Norway, Japan, and South Korea, and reduced its workforce in the United Kingdom and the United States. Despite these setbacks, the acquisition by SoftBank is seen as a strong endorsement of Graphcore’s potential in the AI chip market.
Graphcore was founded in 2016 by Nigel Toon and Simon Knowles with ambitions to rival major technology firms in AI chip development. While the company has struggled financially, its innovative IPUs remain a valuable asset within the rapidly evolving AI industry.
This acquisition aligns with SoftBank’s strategy of investing in cutting-edge technologies and reinforces its commitment to advancing AI capabilities. As part of SoftBank, Graphcore is poised to leverage greater resources and support to enhance its product offerings and market reach.
