UK AI chipmaker seeks buyer, report
Graphcore has faced rising losses and falling revenues
Graphcore, the Bristol-based maker of advanced AI processors is reportedly seeking a buyer.
The company, once mentioned as a potential rival to Nvidia for high-performance chipsets for machine learning, was valued at £2.2 billion in 2020. It is now seeking a buyer at a valuation of around £400 million, according to the Telegraph.
Graphcore makes what it calls Intelligence Processing Units (IPUs), described as "a completely new kind of massively parallel processor" to accelerate machine intelligence.
While they have found their way into a few high-performance servers, such as Dell's DSS8440, Graphcore's chips have largely failed to make an impact, perhaps because their specialised architecture is a remove from the more familiar Nvidia graphics processing units (GPUs).
The company claims its IPUs have performance and energy efficiency advantages over its rival's GPUs for machine learning. But while Nvidia has ridden the AI boom to become one of the most valuable companies in the world with a market capitalisation of around $1.7 trillion, Graphcore is reportedly seeking a buyout. The list of potential suitors includes Arm, SoftBank and OpenAI, according to the Telegraph, although none of these companies have commented on the matter.
The news comes after several months of rising losses and falling revenues. Graphcore has faced cash flow problems and needs to raise new funding by May 2024 to avoid going under. It has already made job cuts and closed some offices to reduce costs.
The company was dealt a particularly hard blow last year, when the government announced plans for a new £900 million exascale supercomputer, the first outside the US, to be built in Graphcore's home city of Bristol.
Despite Rishi Sunak's talk of making the UK a technology superpower, Graphcore processors were not selected to be part of this development. The company's CEO Nigel Toon had requested that some of the supercomputer's funds be reserved for the UK chip industry, but was turned down.
The company's relative lack of visibility, technology differences, financial instability and failure to win the exascale bid has likely influenced purchasing decisions in favour of the incumbent in the AI race. Nvidia dominates the AI chip market, making it difficult for new companies to gain traction.
Investors have also cooled on funding challengers. An early Graphcore investor was Microsoft, but in 2020 the tech giant stopped using the company's processors. Microsoft is now a major investor in OpenAI.
The UK government has been criticised by the semiconductor industry for failing to understand and support homegrown products.