U.S.-based AI chip startup Groq is in talks to raise between $300 million and $500 million at a post-money valuation of $6 billion, according to sources cited by The Information on July 9. The Silicon Valley company is seeking the new funding to support a recent contract signed with Saudi Arabia.

In February 2025, Saudi Arabia committed $1.5 billion to help Groq expand delivery of its advanced AI inference chips in the country. Groq has told investors the deal could generate approximately $500 million in revenue this year.

Groq specializes in developing AI inference chips designed to accelerate execution of pre-trained models with high-speed efficiency. The company is positioning itself as a key player in next-generation AI infrastructure.

The new fundraising effort comes less than a year after Groq raised $640 million in a Series D round led by Cisco Investments, Samsung Catalyst Fund, and BlackRock Private Equity Partners in August 2024. That round valued the company at $2.8 billion.

If successful, the upcoming round would more than double Groq's valuation, further underscoring investor confidence in AI hardware amid soaring demand for efficient, low-latency inference solutions globally.