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Groq Raises $350 Million To Expand Its AI Cloud Business

Groq has raised $350 million as the AI infrastructure startup continues shifting from developing its own chips toward a neocloud model built around Nvidia hardware.

The round was led by investment firm Disruptive, with Nvidia also planning to participate. The deal values Groq at $3.5 billion, down from the $6.9 billion valuation it reached in September 2025.

The change follows a major shift in the company’s strategy. In late 2025, Nvidia hired Groq founder and CEO Jonathan Ross and other senior employees as part of a $20 billion licensing deal. Groq says the new valuation reflects its business after that deal rather than a traditional down round.

From AI Chips to Cloud Infrastructure

Groq originally developed its own language processing units, or LPUs, for AI inference, the computing needed to run AI models in real time.

After losing much of its senior team, the company shifted toward cloud and data center services using Nvidia systems. In June, Groq raised another $650 million to support the transition.

Today, Groq operates 13 data centers across North America, Europe, the Middle East and Asia-Pacific, serving more than 6 million developers, enterprises and AI companies. It plans to increase capacity from 54 megawatts to more than 200 megawatts in 2027.

The latest funding will help Groq provide customers with access to larger Nvidia computing clusters for AI training and inference.

Can Neoclouds Become Profitable?

Groq is betting on rising demand for AI inference as businesses expand their use of AI. Yet the neocloud model faces questions over whether companies can generate sufficient returns from the huge cost of building and operating AI infrastructure.

CoreWeave has reported strong revenue growth and secured major contracts with Meta and Anthropic, but investors remain concerned about its capital spending, debt and the rapid depreciation of AI hardware.

Groq does not publicly disclose its financial results. Its new strategy also places it within Nvidia’s broader AI infrastructure ecosystem, alongside neocloud providers such as CoreWeave, Lambda and Nebius.

Esports Must Put Children’s Rights Ahead Of Competitive Ambitions, Report Says

Competitive gaming can help children build skills, find community and pursue achievement. However, as esports grows, young players face health, psychological and online safety risks, often without consistent safeguards, according to a new report from Save the Children.

The report, Protecting Child Rights in Esports, estimates that up to 300 million children worldwide participate in esports. It calls on the industry to prioritise the rights set out in the United Nations Convention on the Rights of the Child over competitive ambitions.

Potential risks include disrupted sleep, musculoskeletal pain, anxiety, depression, sexism and online harassment. Intensive training can also leave less time for education, family and friends.

“Esports offers exciting opportunities for children, but participation should never come at the expense of their rights, wellbeing or development,” said Theo Toresson, a psychologist and gaming expert at Save the Children.

Children must be treated “as children first and competitors second”, he added, calling for their involvement in decisions that affect them.

Training Standards Remain Uneven

The report highlights the lack of widely established standards for training hours and methods. Extended periods of sitting, insufficient breaks and schedules that interfere with sleep, exercise and schoolwork can affect young players’ health and development.

Poor posture and long sessions may also cause neck, shoulder and wrist pain, while late-night gaming can undermine sleep, concentration and mood.

Although some organisations provide guidance on breaks, nutrition, sleep and hydration, a representative of a national esports federation told the report that this advice often draws on separate studies rather than a centralised set of guidelines.

The report also notes positive findings: many professional esports players report satisfactory levels of physical activity, and higher-ranking players often place greater emphasis on fitness.

Online Harassment Adds To Mental Health Risks

Gaming communities and livestreaming platforms can help young players build connections and public profiles, but they may also expose them to cyberbullying, discrimination and privacy violations.

An analysis cited in the report examined chatrooms across 302 gameplay segments involving the 20 most popular Twitch streamers. It found sexist language in 62% of streams, racist language in 37%, ableist language in 84% and violent language in 97%.

Some esports federations and teams require staff to receive mental health first-aid training, but the practice remains uncommon. Young competitors may also face public scrutiny through livestreams, interviews and social media before they have the support to manage it.

Safeguards Must Extend Beyond Gameplay

The report raises further concerns about unequal participation linked to gender, race, LGBTQIA+ identity and disability. It also highlights children’s limited involvement in decisions affecting them and the risk of economic exploitation by teams, agents or parents, particularly where contracts lack transparency.

Inadequate supervision at live events presents additional risks.

Save the Children argues that protecting young competitors requires more than advice on posture and screen breaks. Clear standards, responsible oversight and age-appropriate safeguards are needed to ensure esports supports children’s development rather than putting it at risk.

As competitive gaming expands, the industry faces growing pressure to make children’s rights and wellbeing part of its operating standards.

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