Qualcomm in talks to acquire AI chip startup Tenstorrent for up to $10 billion, report

The race to challenge Nvidia’s grip on AI hardware may be heading for another blockbuster deal.

Qualcomm has been in discussions to acquire AI chip startup Tenstorrent in a transaction that could value the company between $8 billion and $10 billion, according to an exclusive report from The Information. If completed, the deal would rank among the largest AI hardware acquisitions in recent years and signal Qualcomm’s growing ambitions beyond smartphones.

“Qualcomm has been in talks to buy Tenstorrent, a startup that designs chips for AI, according to a person with direct knowledge of the deal. The two companies have discussed a price between at least $8 billion and $10 billion, the person said, which would be a significant premium to Tenstorrent’s last valuation,” The Information reported.

The talks are still in the early stages, and no agreement has been reached. Sources familiar with the matter told The Information that Tenstorrent has been speaking with investment banks about strategic alternatives, including raising additional capital.

The reported valuation highlights how quickly investor interest in AI infrastructure companies has grown. Just months ago, TechStartups reported that Toronto-founded Tenstorrent was seeking roughly $800 million in funding at a $3.2 billion valuation. A deal near $10 billion would represent a dramatic increase in value in less than a year.

Tenstorrent has attracted attention from multiple semiconductor giants. Bloomberg previously reported that both Qualcomm and Intel had expressed interest in acquiring the company, though those discussions were described as preliminary. Tenstorrent declined to comment on the reports, and neither Qualcomm nor Intel has publicly confirmed the talks.

Founded in 2016 by Ljubisa Bajic, Milos Trajkovic, and Ivan Hamer, Tenstorrent has emerged as one of the more closely watched startups in AI silicon. The company develops AI accelerators, processors, and computing systems built around RISC-V cores and chiplet-based architectures. Its strategy centers on providing developers and enterprises with alternatives to dominant AI hardware platforms.

A major turning point came in 2020 when legendary chip architect Jim Keller joined Tenstorrent as chief technology officer. Keller later became CEO and has helped shape the company’s vision in a market increasingly dominated by Nvidia.

Keller’s résumé spans some of the most influential chip programs of the past two decades. He played key roles in AMD’s Zen processors, Apple’s A-series chips, Tesla’s Autopilot silicon, and Intel’s CPU efforts. Under his leadership, Tenstorrent has expanded its focus from AI inference into training workloads, positioning itself as a broader AI computing company.

Keller has openly discussed the challenges facing AI chip startups competing against Nvidia. “You can’t beat Nvidia if you use HBM,” he said in a Bloomberg interview last December, arguing that high-bandwidth memory costs create significant barriers for competitors.

Investors have taken notice. Tenstorrent raised more than $693 million in a Series D funding round in 2024 at a valuation estimated between $2 billion and $2.6 billion. The company later pursued an additional funding round of roughly $800 million at a $3.2 billion valuation. Its backers include Samsung, Bezos Expeditions, and several other prominent investors.

The startup’s products, including its Blackhole architecture, PCIe accelerator cards, and AI systems, have attracted developers searching for alternatives in a market dominated by Nvidia.

For Qualcomm, acquiring Tenstorrent could accelerate a broader effort to establish a stronger position in AI infrastructure.

The chipmaker has spent the last few years reducing its dependence on smartphone revenue and pushing deeper into data centers, enterprise AI, automotive systems, and edge computing. Qualcomm’s roadmap includes custom AI chips, server processors based on its Oryon architecture, and AI inference accelerators such as the AI200 and AI250.

The company has already landed major AI-related business. Recent reports indicate Qualcomm secured an agreement to supply millions of custom AI chips to ByteDance. Earlier this year, Qualcomm acquired AlphaWave IP, strengthening its data center networking capabilities.

A Tenstorrent acquisition would give Qualcomm immediate access to advanced AI chip technology, a highly regarded engineering team, and one of the industry’s best-known chip designers.

The timing reflects a broader shift across the semiconductor industry. As demand for AI computing continues to surge, established chipmakers are seeking faster paths to market through acquisitions, partnerships, and strategic investments. Nvidia remains the dominant force, though companies including AMD, Intel, Qualcomm, and hyperscale cloud providers are investing heavily in alternative architectures.

Questions remain about whether a transaction will materialize. Tenstorrent’s exploration of both funding and acquisition options gives the startup flexibility, and discussions could change direction or end without a deal.

Still, the fact that Qualcomm is reportedly considering paying up to $10 billion for Tenstorrent offers another reminder of how valuable AI infrastructure companies have become. What was once a relatively obscure startup is now at the center of a high-stakes battle for the future of AI computing.