The boss of the UK computer chipmaker hailed the deal as a ‘tremendous endorsement’ of its work
Bristol’s AI firm, Graphcore, has been bought by Japanese investment giant SoftBank in its latest bid to capitalise on next-gen tech.
The UK chipmaker’s boss lauded the deal as a “tremendous endorsement” of their work. While the acquisition’s value remains undisclosed, Graphcore was valued at £2.2billion in 2020 after securing hundreds of millions from investors.
Despite this, the firm faced financial hurdles, posting a pre-tax loss of £159million in 2022 and sales of just £2.1million according to the most recent publicly available financial data. The company cited wider economic challenges that led to a slump in hardware sales, forcing it to close branches in Norway, Japan, and South Korea, and reduce its workforce in the UK and US.
Graphcore, founded in 2016 by Nigel Toon and Simon Knowles, positioned itself as a rival to US tech titan Nvidia with its AI chips. Nvidia briefly surpassed Microsoft as Wall Street’s priciest stock last month.
Mr Toon, who also serves as Graphcore’s chief executive, said SoftBank’s acquisition was a “tremendous endorsement of our team and their ability to build truly transformative AI technologies at scale, as well as a great outcome for our company”.
“There remains much to do to improve efficiency, resilience, and computational power to unlock the full potential of AI. In SoftBank, we have a partner that can enable the Graphcore team to redefine the landscape for AI technology.”
The firm specialises in designing and manufacturing processors and software tools that support advancements in machine intelligence. It also boasts UK offices in Cambridge and London. This acquisition will bolster SoftBank’s portfolio of tech and AI-centric businesses.
In 2016, it took over Arm, a Cambridge-based tech company that designs chips for a range of devices including mobile phones, tablets and digital TVs. Arm debuted its shares on the US stock market last year, but SoftBank maintained a nearly 90% stake in the company.
Derren Nathan, head of equity research at Hargreaves Lansdown, expressed disappointment that Graphcore has been snapped up by the Japanese investment group. He stated: “Graphcore’s commercial traction has been underwhelming but its Intelligent Processing Units are claimed to have some significant advantages over Nvidia when it comes to training AI models.”
“That remains to be seen, but this is a hot space and it’s somewhat disappointing to see British innovation move to overseas ownership. In days of yore this would have been a prime candidate for the flotation on London’s Alternative Investment Market, but the risk appetite in the London market has all but dried up.”
