Qualcomm in Advanced Talks to Acquire AI Chip Startup Modular for US$4 Billion
Source: CNA Business (Reuters)
The potential acquisition would value Modular at 2.5x its September 2025 valuation, signalling intense demand for AI chip startups. Qualcomm is also reportedly pursuing a separate US$8-10 billion deal for Tenstorrent.
Qualcomm is in advanced discussions to acquire AI chip startup Modular Inc. for approximately US$4 billion, according to Bloomberg News. The deal would represent a 2.5x valuation increase from Modular’s US$1.6 billion valuation during its September 2025 funding round, reflecting the intense market premium for AI semiconductor startups. An announcement could come in the coming weeks, though negotiations may still fall through.
Modular, founded in 2022, has raised US$380 million to date. The startup develops AI chips and software aimed at making AI model deployment more efficient across data centres and edge devices. Qualcomm’s interest comes as the smartphone chip giant works to reduce its reliance on the volatile handset market by branching into fast-growing areas like data centre processors and autonomous vehicle chips. The company is also reportedly in advanced talks to acquire Tenstorrent for US$8-10 billion, signalling a major strategic pivot into AI infrastructure.
The deal has implications beyond pricing. Qualcomm’s aggressive M&A push reflects a broader consolidation trend in the AI semiconductor space, where demand for specialised chips is outstripping supply and driving up startup valuations. For Singapore, Qualcomm’s substantial R&D operations in the city-state mean that shifts in the company’s AI strategy could have downstream effects on local chip design talent and partnerships. The company’s Singapore design centre has been a key node in its global semiconductor operations for years.
Why it matters for Singapore: Qualcomm’s deepening commitment to AI chips aligns with Singapore’s own push into semiconductor and advanced manufacturing capabilities under the Manufacturing 2030 initiative. As Qualcomm redirects resources toward data centre and automotive AI processors, its Singapore R&D centre stands to play a larger role in the company’s global AI chip design workflow—potentially creating high-value engineering roles and deepening the city-state’s position in the AI hardware supply chain.