Nvidia spent over $900 million to hire Enfabrica CEO, license technology, CNBC reports

Sept 18 (Reuters) - Nvidia NVDA.O has spent over $900 million to hire Enfabrica CEO Rochan Sankar and other staff at the artificial intelligence hardware startup and to license the company's technology, CNBC reported on Thursday.

The AI chip giant is paying in cash and stock, CNBC said, citing two people familiar with the arrangement. The deal closed last week and Sankar has already joined Nvidia.

Enfabrica, a Silicon Valley-based chip startup, is tackling one of the biggest technical problems that has emerged in the AI field: how to tie tens of thousands or more chips together with a network to effectively work as a single computer.

If that network is too slow, expensive chips from companies such as Nvidia end up sitting idle and waiting for data.

The startup's technologies can string together about 100,000 AI computing chips before the network starts to bog down.

Nvidia declined to comment, while Enfabrica did not immediately respond when contacted by Reuters.

Founded by veterans from Broadcom AVGO.O and Alphabet, Enfabrica has raised $260 million in venture capital. It released a chip-and-software system in July aimed at reining in the cost of memory chips in those centers.

The deal is reminiscent of the recent agreements by Meta META.O and Google, according to the CNBC report.

In June, Meta took a 49% stake in Scale AI and brought in its 28-year-old CEO, Alexandr Wang, to play a prominent role in the tech giant's artificial intelligence strategy.

Alphabet's GOOGL.O Google hired several key staff members from AI code generation company Windsurf, following an attempt by its rival OpenAI to acquire the startup.