Qualcomm Acquires Chip Startup Modular for $4 Billion

Qualcomm has officially announced its acquisition of Silicon Valley chip startup Modular for nearly $4 billion. The deal, revealed on Wednesday, will see the mobile chip giant issue up to 19.2 million shares of common stock, valued at just under $4 billion based on Qualcomm’s most recent closing share price. This move arrives just nine months after Modular raised $250 million at a $1.6 billion valuation, and the transaction is expected to close in the second half of this year.

Modular specializes in a chip software platform and a proprietary coding language that enables developers to write AI software that runs across different chips without needing to rewrite code for each one. The startup’s entire team, including its two cofounders and roughly 150 employees, will join Qualcomm.

“We believe the future belongs to developer-friendly, horizontal platforms that can run across diverse compute environments and give customers real choice in how and where they deploy AI,” said Qualcomm president and CEO Cristiano Amon in a statement.

This acquisition signals Qualcomm’s growing ambitions to expand beyond the mobile device market, which still generates the majority of its revenue. Amon recently noted that the company is working on 40 different chip designs for AI gadgets, including smart glasses, jewelry, earbuds, pins, and watches. At the same time, Qualcomm is making a major push into the data center market, which demands more powerful chips.

Late last year, Qualcomm acquired Ventana Micro Systems, a startup building server CPUs based on RISC-V, an open-standard chip architecture. The company is also developing custom ASIC designs for data centers, with China’s ByteDance reported as an early customer.

Modular was founded in 2022 by Chris Lattner and Tim Davis, both of whom previously worked on Google’s TPU chips. Lattner’s career is particularly storied: he created the open-source compiler infrastructure project LLVM and Apple’s Swift programming language, and briefly led Tesla’s Autopilot software program. (Famed AI researcher Andrej Karpathy, who recently joined Anthropic, later took that role.)

Lattner and Davis aimed to build a unifying software layer that helps cloud businesses maximize performance from GPUs and CPUs. In doing so, Modular challenged Nvidia’s CUDA, a closed software system for GPUs, and AMD’s ROCm, which is open-source but not always easy to port to other chips.

This put Modular in a complex position: it eventually secured partnerships with those big chipmakers, as well as with hyper-scalers like Amazon and even Apple, while simultaneously competing with them and their in-house software.

At the time, Lattner said he believed that he and Davis were tackling a software problem that had to be solved outside of a Big Tech environment because it was “structural.” Ultimately, the structure of Qualcomm won out.