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Qualcomm to buy AI startup Modular in $4 billion deal

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June 24 : Qualcomm said on Wednesday it would buy AI startup Modular in an all-stock deal valued at nearly $4 billion, as the chipmaker looks to diversify beyond its core smartphone business.

Buying Modular pits Qualcomm against CUDA, the software platform that has helped underpin Nvidia’s AI dominance by tying millions of developers to the $5 trillion company’s chips.

As part of the deal, Qualcomm expects to issue up to 19.2 million shares of its common stock to Modular’s equity holders.

The transaction is valued at about $3.92 billion, according to a Reuters calculation based on Qualcomm’s last closing share price.

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Qualcomm has been seeking a larger foothold in the data-center market as demand for generative AI surges, and is already targeting the market with processors for data centers and other AI chips with shipments planned by the end of the year.

Modular’s software is primarily used to run, or “infer”, AI models, a market that has emerged as the latest battleground for chipmakers as Nvidia looks to ward off competitors that are selling custom chips developed for in-house use.

The deal is expected to close in the second half of this year.

Source: Reuters

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