SoftBank Acquires Graphcore in Strategic AI Move
Graphcore, a UK-based AI chip company headquartered in Bristol, provides advanced Intelligence Processing Units (IPUs) tailored to meet the unique computational demands of artificial intelligence. In 2022, they introduced the world’s first 3D Wafer-on-Wafer (WoW) packaged processor. Despite the recent surge in global interest in AI, the deteriorating macroeconomic environment and the US’s regulatory measures on AI technology sales have significantly impacted Graphcore’s hardware sales and revenue.
Recently, Graphcore announced its acquisition by SoftBank, though the exact financial details of the transaction were not disclosed. According to the agreement, Graphcore will become a wholly-owned subsidiary of SoftBank and will continue to operate under the Graphcore name.
“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,” said Graphcore co-founder and CEO Nigel Toon. “Demand for AI compute is vast and continues to grow. There remains much to do to improve efficiency, resilience, and computational power to unlock the full potential of AI. In SoftBank, we have a partner that can enable the Graphcore team to redefine the landscape for AI technology.”
Despite significant investments in AI chip development, Graphcore has struggled to establish a strong market presence and profitability, with a 46% decline in revenue in 2023. Facing mounting losses, the company sought new financing to maintain operations. As early as October last year, reports emerged that Graphcore was seeking investment to offset operational losses. To reduce expenses, Graphcore implemented layoffs and closed multiple global offices.
Earlier this year, reports indicated that Graphcore was in discussions with overseas investors regarding potential deals, aiming to raise approximately $528 million in funding.
