Groq, a California-based AI chip company, has struck a deal with Saudi oil giant Aramco to build a large data center in Saudi Arabia. The facility aims to boost the kingdom's AI capabilities.
Groq CEO Jonathan Ross says the data center should be up and running by year's end, initially housing 19,000 language processing units (LPUs). The partners are considering expanding to 200,000 LPUs in the future.
Founded in 2016, Groq develops specialized hardware for AI applications. Its LPUs are designed to run language models at high speeds, processing hundreds of tokens per second.
Groq claims the planned Saudi facility will become the world's largest AI inference center. Aramco will fund the project, which Ross estimates will cost in the nine-figure range.
The partnership aligns with Saudi Arabia's push to become a tech hub and diversify its economy. Aramco is "planning to do massive capital deployments for this, and it is a way to help diversify the economy away from oil," Ross explained.
Groq aims to take advantage of Saudi Arabia's cheap energy and available land. The location also offers low-latency access to four billion people within 100 milliseconds.
Groq rides the AI chip wave
Groq recently raised $640 million in funding, valuing the company at $2.8 billion. BlackRock led the round, with Cisco Systems and Samsung Electronics also investing.
Groq's LPUs could offer an alternative to Nvidia's chips for AI inference, but not for training models. Nvidia chips are in high demand for both tasks.
Ross said Groq doesn't expect US export restrictions and has been transparent with the Commerce Department about its Saudi plans. The company has chosen not to sell to Chinese firms or entities.
The Groq-Aramco partnership may expand to other projects. "The expectation is that we’re going to partner with Aramco Digitial for quite a bit of our deployment in this region and anywhere we can," Ross said.
