Qualcomm is eyeing a $4bn Modular buy to grab AI software clout without picking a silicon fistfight with Nvidia.
According to Bloomberg, the chipmaker is in advanced talks to buy AI infrastructure software outfit Modular,
The deal would value Modular at about $4bn, although no final agreement has been signed and the terms could still shift.
Qualcomm built its empire on smartphone chips, but now wants a bigger slice of AI, where Nvidia still owns the expensive end of the room.
Modular builds software that helps AI models run across different chips, systems and data centres without turning every deployment into a plumbing disaster.
The industry is shifting from training huge models to inference, where models serve users and cash gets counted.
Owning that software layer could help Qualcomm steer work towards its own hardware and partners, rather than fighting Nvidia on raw silicon alone.
Modular founders Chris Lattner and Tim Davis set up the Silicon Valley startup in 2022 after meeting at Google. The pair were fed up with the splintered mess of AI infrastructure. Modular has raised $380mn in total, including a $250mn round in September that valued it at $1.6bn.
A $4bn sale would more than double that valuation in nine months, which shows how daft AI infrastructure pricing has become.
Qualcomm has been buying its way into new markets since US regulators torpedoed its planned NXP Semiconductors takeover.
Last year it agreed to buy London-listed Alphawave IP Group for about $2.4bn in cash, but Modular would sit closer to its AI ambitions.
Qualcomm shares have climbed about 30 per cent this year, helped by hopes that AI might make the outfit less dependent on phones.
The risk is that AI valuations have sprinted miles ahead of revenue, and $4bn for a startup last priced at $1.6bn will test a few nerves.
