Yotta plots $12 billion next-gen Nvidia chip order

According to the New York Times, the Department of Justice (DOJ) is currently investigating Nvidia's $20 billion non-exclusive agreement with AI chip company Groq. The investigation aims to determine if the deal was structured in a way that would circumvent antitrust scrutiny. If Nvidia is found to be at fault, it could face fines.

The agreement grants Nvidia non-exclusive rights to Groq's technology, specifically AI chips suited for low-latency inference. The first AI rack featuring Groq chips is set to launch later this year. Sources with knowledge of the inquiry told the NYT that the DOJ has issued Nvidia a formal request for information regarding the Groq deal.

The issue of deals structured as licensing agreements instead of acquisitions is prevalent in the AI industry, as such structures can bypass automatic government reviews. The NYT sources emphasized that the DOJ's probe may result in no findings of wrongdoing. The investigation is part of ongoing calls from senators earlier this year for the FTC and DOJ to scrutinize these types of tech deals, arguing that they function as de facto mergers, allowing big tech companies to consolidate talent, information, and resources while potentially evading typical merger and acquisition reviews.