U.S. regulators are investigating Nvidia’s deal with artificial intelligence chip startup Groq, raising new questions about the chipmaker’s growing influence over the AI hardware market.
The U.S. Justice Department is investigating Nvidia’s $17 billion licensing deal with Groq and examining whether the agreement was structured in a way that could avoid traditional antitrust scrutiny, according to reports citing people familiar with the matter.
The investigation comes as regulators in the U.S. continue to examine how major technology companies expand their control over emerging AI technologies. Nvidia has become one of the most important companies in the AI industry because of its dominant position in chips used to train and run advanced AI models.
Nvidia announced its agreement with Groq in December 2025. Rather than buying the startup, Nvidia agreed to license Groq’s AI chip technology and hired several of its senior executives, including co-founder and CEO Jonathan Ross and COO Sunny Madra. Groq continued to operate as an independent company after the agreement.
Regulators Question Nvidia’s Access to Groq Technology
The main question for regulators is whether Nvidia’s arrangement with Groq effectively gave the company access to a potential competitor’s technology and key employees without requiring the same level of regulatory review that would normally apply to an acquisition.
Groq develops specialized chips designed for AI inference, which is the process of running AI models after they have been trained. Inference is becoming increasingly important as companies use AI models for chatbots, search tools, coding assistants, enterprise software and other applications.
The growth of AI services has also created demand for alternatives to traditional AI processors. While Nvidia has built its position around GPUs that can handle both AI training and inference workloads, companies such as Groq have developed specialized hardware aimed at making AI inference faster and more efficient.
This has made startups developing AI chips potential competitors or strategic partners for larger technology companies.
Nvidia already holds a dominant position in the market for AI chips used to train and run large AI models. Regulators are therefore paying close attention to deals that could give the company additional access to competing technologies, talent or intellectual property.
U.S. Senators Elizabeth Warren and Richard Blumenthal also raised concerns about the agreement earlier this year. In March, they questioned whether Nvidia’s roughly $20 billion deal with Groq was structured to avoid U.S. antitrust laws.
Their concerns reflect a broader debate over whether large technology companies can gain control over important startups without formally acquiring them.
DOJ Requests Information From Nvidia
The Justice Department reportedly began examining the arrangement after Nvidia announced the agreement in December. The agency has since asked Nvidia to provide information about the deal.
The review focuses on the structure of the transaction and the potential competitive impact of Nvidia gaining access to Groq’s technology and senior personnel.
The Federal Trade Commission has also been paying closer attention to arrangements in which large technology companies license technology from startups while hiring their employees without formally purchasing the companies.
Such deals have become more common in the technology sector. A company can sometimes obtain access to valuable technology and experienced employees through licensing agreements and employment arrangements while leaving the startup legally independent.
Regulators have increasingly questioned whether these structures can have competitive effects similar to traditional acquisitions.
However, the investigation does not mean Nvidia has broken the law. Regulators are still examining the agreement, and there has been no public finding that Nvidia violated U.S. antitrust laws.
Nvidia Defends the Agreement
Nvidia has defended its arrangement with Groq and described it as a non-exclusive technology licensing deal. The company has also stressed that it did not acquire Groq itself. According to Nvidia’s regulatory filings, the company did not buy Groq’s customer contracts, existing products or equity interests.
Nvidia’s financial filings provide more details about the value of the transaction. The company paid $13 billion when the deal closed, while another $4 billion, including imputed interest, was due within one year, according to Nvidia’s 2026 annual report.
The Justice Department has not publicly commented on the investigation.
Nvidia’s position is important because the company has consistently faced questions about its growing influence in AI. Its chips have become a critical part of the infrastructure used by major technology companies to develop and operate AI systems.
Any transaction involving another AI chip developer is therefore likely to receive close attention from regulators.
Groq Remains an Independent Company
Despite the agreement with Nvidia, Groq continues to operate independently. The startup also raised $350 million in new funding in August, with Nvidia expected to participate.
Groq’s continued independence is a central part of Nvidia’s argument that the arrangement was a licensing agreement rather than an acquisition. However, regulators are examining whether the practical effects of the deal could still reduce competition.
Nvidia gained access to Groq’s technology through the licensing agreement and hired several of the startup’s top executives. Jonathan Ross, Groq’s co-founder and CEO, was among the executives who joined Nvidia.
This combination of technology access and employee hiring has attracted regulatory attention because talented engineers and executives can be particularly valuable in the fast-growing AI chip industry.