Intel Nears SambaNova Acquisition at $1.6B Fire-Sale Price, Down from $5B Valuation

In November, reports emerged that Intel was considering a $5 billion acquisition of AI startup SambaNova to accelerate its AI transformation through the latter’s RDU-based architecture. More recently, however, fresh reports suggest the actual deal value may be sharply reduced—to around $1.6 billion.

According to Bloomberg, the latest information contrasts starkly with earlier speculation of a $5 billion purchase, indicating that the transaction, if completed, could close at a price closer to $1.6 billion.

If confirmed, such a valuation would amount to a “fire-sale” price for SambaNova. Founded in 2017, the company was valued at over $5 billion during its 2021 funding round. This dramatic repricing underscores the harsh reality facing second-tier AI chip startups amid an AI hardware market increasingly dominated by NVIDIA, where survival pressures and valuation corrections have become unavoidable. Adding intrigue to the potential deal is the role of Intel’s current CEO, Lip-Bu Tan.

SambaNova’s investor roster has long been distinguished, including SoftBank, Google Ventures, and Intel Capital itself. Tan’s personal investment firm, Walden International, was also an early backer, and Tan was appointed to SambaNova’s board in May last year. These deep ties are widely seen as a key catalyst accelerating negotiations between the two companies. SambaNova’s core strengths lie in its DataScale systems and SN40L processors, designed for high-performance generative AI inference and fine-tuning. Unlike NVIDIA’s focus on general-purpose GPU computing, SambaNova embraces a software-defined hardware architecture—an approach that carries several strategic implications for Intel:

• Strengthening inference capabilities: As Intel’s Gaudi lineup struggles to compete head-on with NVIDIA’s H100 and B200, SambaNova’s technology could offer differentiated advantages in specific domains, such as large language model inference.
• End-to-end system solutions: SambaNova does more than sell chips; it delivers integrated solutions spanning hardware, compilers, and model-as-a-service offerings. This is precisely the missing piece in Intel’s ambition to pivot toward system-level foundry services and enterprise AI platforms.

From this perspective, Intel’s move appears aimed at rapidly narrowing the technological gap with its rivals. While $1.6 billion is no small sum for a company under financial strain, it may represent a calculated gamble Intel can scarcely avoid.

That said, Intel’s track record with AI acquisitions has been mixed at best, as evidenced by the painful integration processes following its purchases of Nervana and Habana Labs. Should Intel succeed in acquiring SambaNova, the real challenge will lie in smoothly integrating its distinctive architecture into Intel’s existing oneAPI ecosystem—without cannibalizing the Gaudi product line. This will likely be the sternest test yet for Tan and his leadership team.

For now, both Intel and SambaNova have declined to comment. The deal could be finalized within weeks, though it may also be delayed pending further due diligence.

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