DOJ Investigates Nvidia's $17B Groq Licensing Deal

The U.S. Department of Justice has opened an investigation into Nvidia's $17 billion licensing agreement with AI chip startup Groq, according to a report from The New York Times. The probe centers on whether the chipmaker structured the deal to circumvent antitrust oversight.

The transaction under scrutiny

Nvidia announced the deal with Groq in December 2025, framing it as a "non-exclusive license" to Groq's chip technology. As part of the arrangement, Nvidia also hired several Groq executives, including founder Jonathan Ross. The Justice Department launched its investigation shortly after the deal was announced and has since issued a formal demand for information about the transaction, according to two people familiar with the matter cited by the Times.

The structure of the agreement has drawn regulatory attention because licensing deals can sometimes be used to acquire control or influence over a competitor without triggering the formal merger review process that outright acquisitions face.

Why it matters

This investigation reflects growing government scrutiny of how dominant tech companies structure deals in the AI sector. As Nvidia maintains overwhelming market share in AI accelerator chips, regulators are examining whether the company is using creative transaction structures to extend its influence while avoiding the heightened review that traditional acquisitions would receive. The outcome could establish precedent for how licensing agreements with significant financial stakes are evaluated under antitrust law.

Potential outcomes

According to the Times report, if the Justice Department finds fault with how Nvidia handled the transaction, the company may face financial penalties. However, regulators would likely not require the deal to be unwound, suggesting the investigation focuses more on process violations than competitive harm from the arrangement itself.

Neither Nvidia, Groq, nor the Justice Department responded to requests for comment from Reuters outside regular business hours.

Groq has developed specialized chips designed to accelerate AI inference workloads, positioning it as both a potential partner and competitor to Nvidia in certain market segments. The $17 billion valuation attached to the licensing agreement represents one of the largest such deals in the semiconductor industry.

Broader regulatory context

The investigation adds to mounting regulatory pressure on Nvidia as the company's dominance in AI infrastructure has made it a focal point for antitrust authorities. The Justice Department has been examining various aspects of Nvidia's business practices as part of a broader effort to ensure competitive markets in critical technology sectors.

The details of this investigation were first reported by The New York Times.