Intel bolsters its AI business with SigOpt acquisition

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Intel plans to acquire Habana, an AI chip startup, for $1-2 billion.
Image: Cody DeBos / The Burn-In

Over the past several years, Intel has focused its efforts on the specialized chip sector, including those designed specifically for things like artificial intelligence (AI). The industry giant recently made an acquisition that will aid its efforts in the space.

On Thursday, Intel announced that it bought SigOpt, a San Francisco-based startup that is responsible for creating an optimization platform for modeling and simulations. It is unclear what the financial nature of the transaction is. To date, the startup had raised less than $10 million.

Nonetheless, SigOpt has some notable names backing it. That support has allowed it to develop interesting technologies that will now help power Intel’s AI chip business.

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Focus on AI

Intel knows that the computing world is changing. Competitors like Nvidia, AMD, and Arm are closing the performance gap that used to be a dealbreaker for many customers. With that in mind, Intel is pushing the envelope with next-generation chips that are optimized for new and upcoming technologies.

That focus has helped the chip giant offset the downward trend of its legacy operations. In the third quarter of the year, Intel reported a three percent decline in revenues despite beating analysts’ expectations. The drop was led by its data center segment.

However, it predicts that the AI chip market will be worth more than $25 billion in 2024. As the industry continues to evolve and companies begin to implement AI into their operations, there will be even more room to grow.

Last year, Intel brought in just under $4 billion in AI-related revenue. Although that is decent, the acquisition of SigOpt will help it drastically improve its revenue in the future.

Raja Koduri, Intel’s chief architect and senior vice president of discrete graphics, says, “SigOpt’s AI software platform and data science talent will augment Intel software, architecture, product offerings and teams, and provide us with valuable customer insights.”

What Does SigOpt Bring to the Table?

For those who aren’t familiar, SigOpt is a startup born with a mission to “optimize everything.”

The platform that it built to optimize modeling and simulations is the most important considering that those are two key parts of artificial intelligence. That’s also the portion of the business Intel will be utilizing.

Currently, the startup offers its services to a number of Fortune 500 companies and research institutions. Although its core product is still in a closed beta, the startup drew investments from some noteworthy sources.

For one, In-Q-Tel, the strategic investment arm of the CIA, was on board. More traditional investors include the likes of Andreessen Horowitz and Y Combinator.

Despite its acquisition, a SigOpt spokesperson confirmed that the startup will continue to serve its existing clients. A company statement reads, “We will continue to work with SigOpt’s existing customers and will also integrate the technology into our product road map.”

It will be interesting to see how Intel utilizes the company’s resources in the coming days as it makes a push to become the world’s leading AI chipmaker both now and in the future.

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