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From Training to Inference: Nvidia Wins the AI War on Christmas Eve

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In late 2025, Nvidia initiated a strategic $20 billion deal with the AI chip startup Groq to bolster its capabilities in the high-speed inference market. Rather than a traditional merger, the arrangement is structured as a licensing agreement and a massive talent transfer, bringing Groq’s top executives and engineering team directly into Nvidia's workforce. This "acqui-hire" model allows Nvidia to integrate Language Processing Unit (LPU) technology, which offers the ultra-low latency required for real-time AI interactions. By securing this intellectual property while leaving Groq as an independent entity, Nvidia effectively neutralizes a rising competitor while potentially sidestepping regulatory hurdles and antitrust investigations. The move signals a major industry pivot from focusing on training large models to prioritizing the operational speed of AI applications. Investors reacted positively to the news, seeing it as a way for the semiconductor giant to future-proof its dominance against rivals like AMD and Intel.

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