Recent reports from foreign media indicate that Graphcore, the British AI chip unicorn, is considering selling to overseas owners amidst the booming trend of artificial intelligence (AI). Industry insiders have revealed that Graphcore has been in discussions with major tech companies regarding potential transactions, seeking to raise new funds to offset its growing losses. Furthermore, senior investors of Graphcore have significantly increased the value of their stakes in the company, suggesting that the value of this potential transaction may exceed $500 million (£400 million). Rumored buyers include British semiconductor IP giant Arm, Japanese SoftBank Group, and Open AI.
Established in 2016, Graphcore, the British AI chip unicorn, primarily produces AI chips called Intelligence Processing Units (IPUs) aimed at challenging Nvidia’s dominance. As one of the prominent “Nvidia competitors” in the AI chip field in recent years, Graphcore has received investments from major players such as Microsoft and Sequoia Capital, seeking viable alternatives to Nvidia.
In 2018, Graphcore began delivering IPU products to early adopter customers and showcased its C2IPU Accelerator PCle card for the first time at the ICML 2018 conference held in Stockholm, Sweden. In 2019, the company officially launched its IPU products and announced its initial customers, including Microsoft. In 2020, the company introduced the second-generation IPU platform IPU-Machine M2000, equipped with the MK2 GC200 IPU processor, achieving an 8-fold performance increase. That same year, Graphcore raised $222 million at a valuation of $2.8 billion, making it one of the most promising startups in the UK.
However, Graphcore has struggled to gain commercial traction, facing severe financial difficulties. In 2022, Graphcore’s revenue declined from $5 million to $2.7 million, a year-on-year decrease of 46%, while losses expanded by 11% to $204.6 million. In October 2023, Graphcore announced the need for new funding to sustain its operations.
As of the end of last year, Graphcore had $157 million in cash and needed to raise more funds before May of this year. The company’s financial statements indicated that it is in discussions with potential investors but is believed to be struggling to secure new funding.
Meanwhile, in 2023, Graphcore faced a survival crisis, drastically reducing its business in China and taking measures such as layoffs and closing international offices to reduce costs. In November, the company confirmed the decision to stop sales in China, citing new export control regulations in the United States restricting the company’s technology sales to China.
Despite investing heavily in the AI chip field, Graphcore has struggled to establish itself in the market. Analysts suggest that Graphcore needs more funds to compete with companies like Intel, Nvidia, and AMD. Therefore, selling to overseas owners may be a solution to its financial problems.
This paper is from Ulink Media, Shenzhen, China, the organizer of IOTE EXPO (IoT Expo in China)
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