Saudi Arabia Pours $1.5B Into US AI Chip Pioneer Groq, Signaling Global Tech Power Shift
A few weeks ago, US AI experts urged the government to support the local industry by taking steps such as attracting foreign investment. It seems that the Trump administration is taking action in this regard, especially after the emergence of DeepSeek. In a recent development, US AI chip startup Groq has secured $1.5 billion in investment from Saudi Arabia.
Groq (not to be confused with Grok, the AI-powered assistant available through X/Twitter) is a startup focused on developing AI inference chips. This hardware serves to optimize response speed and test commands on pre-trained AI models. The US company was founded by a former Alphabet AI chip engineer.
Saudi Arabia to invest $1.5 billion in US chip startup Groq
During the latest LEAP 2025 (a Saudi global technology event), Groq secured $1.5 billion in funding. The investments will come in later this year and will be used to expand the company’s data centers based in Dammam, Saudi Arabia. While the investment will not go to data centers in the US, the fact that the money is going to an American company is good news for the local IA industry. It means that more countries around the world are relying on American technologies to support their AI developments.
Groq is subject to US export controls. However, the company says it has already obtained all the necessary licenses to ship its AI hardware to Dammam. The Groq chip-powered data centers in the Saudi city run the artificial intelligence model called Allam. It is an LLM developed by the local government and operates in both Arabic and English. Groq set up its data centers in the country in collaboration with Aramco Digital, a subsidiary of Aramco oil company.
The startup’s value has been on the rise for some time now. In August last year, a funding round brought Groq’s value to $2.8 billion. That said, Groq was not the only US company to secure major foreign investment for AI. The country attracted around $14.9 billion in funding during the latest LEAP 2025.
