Chip startup Rivos is looking to challenge chipmaker Nvidia (NVDA) in the AI hardware market, and is reportedly hoping to raise $400–$500 million in order to do so, according to The Information. Backed by Intel (INTC) CEO Lip-Bu Tan, the company is targeting a valuation above $2 billion, and would push its total funding since its 2021 founding to over $870 million. Interestingly, Rivos is building a graphics processing unit designed for running AI models that could launch as early as 2026. The company also completed the physical design of its GPU, and has seen promising early results from chips made by Taiwan Semiconductor Manufacturing Co. (TSM).
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As a result, Rivos is close to finalizing a deal to sell chips to a major publicly traded semiconductor firm, with the potential for future design collaborations. It’s also developing software to convert Nvidia’s CUDA code so it can run efficiently on Rivos chips, thereby making it easier for customers to switch while lowering costs. While many AI chip startups have struggled to match Nvidia’s tight hardware–software integration, Rivos’ founders pitch their solution as a cheaper alternative.
It is worth noting that Rivos’ investors include Dell (DELL), BlackRock (BLK), TSMC, and Intel. At the end of 2024, TSMC valued its 1% stake at about $5 million, which implied a $500 million valuation at the time. The new $2 billion target comes as competition in the AI chip market grows, with rivals like Groq looking for up to $500 million and D-Matrix aiming for $300 million. For Rivos, landing this funding could be the key to becoming a serious contender in a market currently dominated by Nvidia.
What Is a Good Price for NVDA?
Turning to Wall Street, analysts have a Strong Buy consensus rating on NVDA stock based on 35 Buys, three Holds, and one Sell assigned in the past three months, as indicated by the graphic below. Furthermore, the average NVDA price target of $188.86 per share implies 4.1% upside potential.
