Nvidia dropped a surprise announcement on Christmas Eve: a $20 billion deal to license AI chip startup Groq’s technology and bring over most of its team, including cofounder and CEO Jonathan Ross. It was a move that hinted Nvidia is no longer assuming its GPUs will be the only chips useful for the next big phase of AI deployment: running already trained AI models to do everything from answering queries and generating code to analyzing an image—a process known as inference—and doing so at a huge scale.
The Groq deal bolsters the standing of other startups building their own AI chips, including Cerebras, D-Matrix, and SambaNova—which Intel has reportedly signed a term sheet to acquire—as well as newer players like U.K.-based chip startup Fractile. It also lifts AI inference software platform startups like Etched, Fireworks, and Baseten, strengthening their valuations and making them more attractive acquisition targets in 2026, according to analysts, founders, and investors.
Karl Freund, founder and principal analyst at Cambrian-AI Research, pointed to the Microsoft-backed D-Matrix, which raised $275 million last month at a $2 billion valuation. Like Groq, D-Matrix is focused on trading some of the flexibility of Nvidia’s GPUs for greater speed and efficiency when running AI models. “I’m sure D-Matrix is a pretty happy startup right now,” Freund said. “I suspect their next round will be at a much higher valuation.”
Cerebras, another inference-focused chip company, also appears well positioned. Known for its dinner-plate-size “wafer-scale” chip designed to run extremely large models on a single piece of silicon, Cerebras has filed for an IPO after a previous delay. Freund said the company has increasingly been viewed as a potential acquisition target as well. “You don’t want to wait until after the IPO, when it’s more expensive,” he said. “From that perspective, Cerebras is sitting pretty right now.”
Nvidia-Groq deal has clarified market’s direction
Executives at these companies say Nvidia’s move has helped clarify the market’s direction. “When [the Nvidia-Groq deal] happened, we said, ‘Finally, the market recognizes it,’” Sid Sheth, CEO of D-Matrix, told Fortune. “I think what Nvidia has really done is they said, Okay, this approach is a winning approach.”
And Cerebras CEO Andrew Feldman posted on X that, in the past, the perception that Nvidia GPUs were all you needed for AI acted as a moat, keeping AI chip startups from nibbling away at Nvidia’s market share. But that moat is now gone with the Groq deal, Feldman wrote. “It reflects a growing industry reality—the inference market is fragmenting, and a new category has emerged where speed isn’t a feature—it’s the entire value proposition. A value prop that can only be achieved by a different chip architecture than the GPU.”
Still, not everyone is convinced that every inference chip startup will benefit equally. Matt Murphy, a partner at Menlo Ventures, said the chip sector remains a difficult one for venture investors, given the high capital requirements and long timelines. “A lot of VCs stopped investing in chips 10 or 15 years ago,” Murphy said. “It’s capital-intensive; it takes years to get a product out; and the outcomes are hard to predict.”
That said, he pointed to Fireworks, an AI inference platform that raised $250 million at a $4 billion valuation in October, as a startup with a technical advantage, thanks to a founding team filled with engineers who built PyTorch. But he added that it remains unclear how much of the current enthusiasm reflects genuine technical differentiation. “It’s hard to tell who’s really got something significant versus the tide is [raising] all boats, which is what seems to be going on,” he said, adding that consolidation across the sector now appears increasingly likely.
New entrant seeks true disruption
But at least one veteran of the AI hardware world argues that even today’s inference-focused startups are not truly disruptive.
Naveen Rao, former SVP of AI at Databricks and founder of MosaicML, recently left Databricks to start Unconventional AI, which last month confirmed a massive $475 million seed round led by Andreessen Horowitz and Lightspeed Ventures. His critique: Companies like Groq, D-Matrix, and Cerebras may be well positioned in today’s market, but they are still optimizing within the same digital computing paradigm.
After Nvidia’s Groq deal validated demand for faster, more efficient inference, startups that fit neatly into today’s AI stack suddenly look far more valuable—not because they reinvented computing, Rao argues, but because they work within it. Unconventional AI is pursuing a more radical path: building new hardware that exploits the physical behavior of silicon itself, and redesigning neural networks to match it.
“We’ve been building the same fundamental machine for 80 years, a numeric digital machine,” he said. “But there was never one workload that dominated even more than 2% of all compute cycles.” That is changing, he explained: In a few years, 95% of all compute will be used for AI.
From that standpoint, it’s important to construct an entirely different machine than what is built today, he said. However, Rao says the effort could take five years or more to bear fruit—and is not intended to capitalize on the current inference boom.
Anthropic has launched Claude Cowor, a general-purpose AI agent that can manipulate, read, and analyze files on a user’s computer, as well as create new files. The tool is currently available as a “research preview” only to Max subscribers on $100 or $200 per month plans.
The tool, which the company describes as “Claude Code for the rest of your work,” leverages the abilities of Anthropic’s popular Claude Code software development assistant but is designed for non-technical users as opposed to programmers.
Many have pointed out that Claude Code is already more of a general-use agent than a developer-specific tool. It is capable of spinning up apps that perform functions for users across other software. But non-developers have been put off by Claude Code’s name and also the fact that Claude Code needs to be used with a coding-specific interface.
Some of the use cases Anthropic showcased for Claude Cowork include reorganizing downloads, turning receipt screenshots into expense spreadsheets, and producing first drafts from notes across a user’s desktop. Anthropic has described the tool, which can work autonomously, as “less like a back-and-forth and more like leaving messages for a coworker.”
Anthropic reportedly built Cowork in approximately a week and a half, largely using Claude Code itself, according to the head of Claude Code, Boris Cherny.
“This is a general agent that looks well positioned to bring the wildly powerful capabilities of Claude Code to a wider audience,” Simon Willison, a UK-based programmer, wrote of the tool. “I would be very surprised if Gemini and OpenAI don’t follow suit with their own offerings in this category.”
Enterprise AI race
With Cowork, Anthropic is now competing more directly with tools like Microsoft’s Copilot for the enterprise productivity market. The company’s strategy of starting with a developer-focused agent and then making it accessible to everyone else could give it an edge, as Cowork will inherit the already-proven capabilities of Claude Code rather than being built as a consumer assistant from scratch. This approach could make Anthropic—which is already reportedly outpacing rival OpenAI in enterprise adoption—an increasingly attractive option for businesses looking for AI tools that can handle work autonomously.
Like any other AI agent, Claude Cowork comes with security risks, particularly around “prompt injections,” where attackers trick LLMs into changing course by inserting malicious, hidden instructions into webpages, images, links, or any content found on the open web. Anthropic addressed the issue directly in the announcement, warning users about the risks and offering advice such as limiting access to trusted sites when using the Claude in Chrome extension.
The company, however, acknowledged the tool was still vulnerable to these attacks, despite Anthropic’s defenses: “We’ve built sophisticated defenses against prompt injections, but agent safety—that is, the task of securing Claude’s real-world actions—is still an active area of development in the industry…We recommend taking precautions, particularly while you learn how it works.”
The launch has also sparked concern among startup founders about the competitive threat posed by major AI labs bundling agent capabilities into their core products. Cowork’s ability to handle file organization, document generation, and data extraction overlaps with dozens of AI startups that have raised funding to solve these specific problems.
For startups building applications on top of models from major AI companies, the concern about foundational AI labs building a similar functionality as part of their base product is a common one. In response to these concerns, many startups have argued that companies with deep domain expertise or a better user experience for specific workflows may still maintain defensible positions in the market.
Good morning. CFO confidence is on the upswing as 2026 begins, and digital transformation in finance has overtaken enterprise risk management as the top goal for the year ahead.
That’s a key finding of Deloitte’s latest CFO Signals Spotlight report, released this morning. Half of the finance chiefs surveyed named digital transformation as their foremost priority for 2026, followed by cash management optimization and capital allocation. The findings are based on a recent Q4 survey of 200 CFOs across industries at North American companies with at least $1 billion in annual revenue.
Steve Gallucci, global and U.S. leader of Deloitte’s CFO Program, told me the shift reflects how finance leaders are moving from exploration to execution when it comes to technology—particularly AI.
“Efficiency and productivity are certainly part of the equation,” Gallucci said. “But more broadly, we’ve been on this digital evolution for some time.”
In recent years, as advanced technologies like agentic AI burst onto the scene, boards and C-suite leaders have shown increasing interest. Finance chiefs took a cautious approach to implementing these tools. Deloitte’s Finance Trends report finds that finance leaders are now influencing enterprise strategy, driving cost optimization, advancing digital transformation, and building tech-enabled teams.
Last year, many companies focused on testing, creating use cases, and developing comfort with AI, Gallucci noted. But according to the Q4 survey, 87% of CFOs said AI will be extremely or very important to how their finance departments operate in 2026.
“What we’re seeing in some of the answers to the Q4 survey questions is that continued evolution,” Gallucci said. Finance leaders are taking a more deliberate, enterprise-wide approach to transformation and AI is accelerating that commitment, he added.
The report outlines six key areas CFOs plan to prioritize this year: Leveraging digital tools to transform finance operations; going all in on AI; embedding AI agents directly into finance workflows; keeping close watch on changes in buyer behavior; tapping internal talent to manage costs; and exploring more deal-making opportunities.
CFOs also appear focused on redeploying existing finance talent to work alongside AI-driven systems. About half of respondents said their organizations plan to hire or promote internally to help keep worker costs in line for 2026.
As CFOs and finance leaders lean into digital transformation, there’s an expectation that they’re going to have to reskill their existing talent, Gallucci said.
“We’re not seeing a decline in the number of finance professionals as a result of investments in technology and AI,” he said. But as leaders look to the future—both in finance and across the broader enterprise—they are increasingly focused on boosting productivity through technology and combining those tools with the skills of their existing workforce and an agentic digital workforce, he explained.
Competition and consumer dynamics add pressure
While technology transformation tops the agenda, competitive pressure remains a driving force. About half of CFOs cited rising competition as having the biggest impact on their companies, followed closely by shifts in customer behavior and demographics.
Competitive pressures are always near the top of CFOs’ minds, Gallucci said. But what’s different now is how they’re responding—looking across industries to see how others are using AI and digital tools, and applying those lessons quickly, he said.
Gallucci also pointed to evolving consumer demand as a key factor to watch, particularly as major banks and retailers release their fourth-quarter earnings.
There’s evidence of a K-shaped economy, he added. “CFOs are paying close attention to what that means for growth, pricing, and investment strategy.”
Clare Kennedy was appointed CFO of Spencer Stuart, a global advisory firm, effective Jan. 12. Kennedy succeeds Christine Laurens as part of a planned succession and in support of Laurens’ retirement from full-time executive work. Kennedy, who is based in London, joins Spencer Stuart from Maples Group, an international advisory firm, where she served as global chief operating officer. She joined Maples Group from Freshfields, an international law firm, where she served as its global CFO. Kennedy previously spent 18 years at Linklaters, an international law firm, where she held a variety of senior finance and commercial leadership roles. She began her career at Arthur Andersen and EY as a chartered accountant, specializing in tax.
Gillian Munson was appointed CFO of Duolingo, Inc. (NASDAQ: DUOL), a mobile learning platform, effective Feb. 23. Matt Skaruppa will step down after nearly six years with the company; he will remain CFO until Munson starts her new role, at which time he will assume an advisory role. Munson assumes the CFO role after serving on the Duolingo board of directors since 2019 as chair of the audit, risk and compliance committee. She was most recently the CFO of Vimeo and previously held CFO positions at Iora Health, Inc. and XO Group Inc.
Big Deal
A joint statement on Monday from tech giants Apple and Google announced that they have entered into a multi-year collaboration under which the next generation of Apple Foundation Models will be based on Google’s Gemini models and cloud technology. These models are said to power future Apple Intelligence features, including a more personalized Siri coming this year.
The tech giants stated: “After careful evaluation, Apple determined that Google’s AI technology provides the most capable foundation for Apple Foundation Models and is excited about the innovative new experiences it will unlock for Apple users. Apple Intelligence will continue to run on Apple devices and Private Cloud Compute, while maintaining Apple’s industry-leading privacy standards.”
Google and others took the early lead in the AI race, while Apple’s iPhone has lagged rivals on some AI features. Following earlier AI missteps, the Cupertino, Calif.-based company acknowledged last year that a major Siri upgrade would not arrive until sometime in 2026.
“This is what the Street has been waiting for with the elephant in the room for Cupertino revolving around its invisible AI strategy, but we believe this is an incremental positive to both AAPL and GOOGL,” Wedbush Securities analysts wrote in a Monday note on the Apple–Google partnership. Wedbush maintains an Outperform rating on Apple and continues to target a $350 price for the stock.
Going deeper
“Trump threatens to keep ‘too cute’ Exxon out of Venezuela after CEO provides reality check on ‘uninvestable’ industry” is a Fortune article by Jordan Blum.
Blum writes: “As other oil executives lavished President Trump with praise at the White House, Exxon Mobil CEO Darren Woods bluntly said the Venezuelan oil industry is currently ‘uninvestable,’ and that major reforms are required before even considering committing the many billions of dollars required to revitalize the country’s dilapidated crude business. Read the complete article here.
Overheard
“Buying a movie studio is hardly buying secure, hard assets.”
—Jeffrey Sonnenfeld, Yale professor and founder of the Yale Chief Executive Leadership Institute, and Stephen Henriques, a senior research fellow, write in a Fortune opinion piece titled “A Cautionary Hollywood Tale: The Ellisons’ Lose-Lose Paramount Positioning” regarding the multiple bids for Warner Bros. Discovery.
The Oval Office’s plan to force the Fed into submission is unlikely to work, Wall Street believes. In fact, they fear it may backfire so spectacularly that interest rate cuts which would have happened under Powell will be nixed as the central bank asserts its independence.
Over the weekend, Fed chairman Jerome Powell confirmed the Department of Justice had served the Federal Reserve with grand jury subpoenas relating to his Senate Banking Testimony on the renovation of Fed buildings.
It was a move that realists may have seen coming—after all, Trump has already levelled legal threats against other members of the rate-setting Federal Open Market Committee (FOMC)—but is unprecedented nonetheless. It comes after a year of lobbying by Trump, who wants the FOMC to cut the base rate to foster economic activity and reduce borrowing costs, regardless of the inflation risk.
However, Trump may not have banked on the fact that the FOMC (even under a new Fed chair this year) might want to make a point of that independence, and go to lengths to demonstrate it. As UBS’s Paul Donovan told clients this morning: “Any nominee from U.S. President Trump is likely to have to place additional emphasis on their independence to try and prove they are above politics. This might impact future policy decisions.”
As Bernard Yaros, lead U.S. economist for Oxford Economics, observed in a note yesterday: “The criminal investigation … could even backfire by making officials more reluctant to cut rates in the coming months and years.”
But there’s also another unexpected fallout which Trump is unlikely to enjoy: Powell may choose to stay on as a bastion of independence after a new Fed chairman is nominated. While his time as Fed chairman expires this year, his term on the Board of Governors does not expire until 2028. “If Powell was looking for a reason to stay on as a Governor … this could be one,” noted Deutsche Bank’s Jim Reid this morning. “It’s very unusual to stay on but [former Fed Chairman Marriner] Eccles did so in 1948 for 3.5 years to help protect and secure Fed independence after the Treasury were trying to fund large post war time debts.”
An unpopular plan
Investors might have hoped Trump had learned his lesson when it came to meddling with the Fed: When he threatened to fire Powell earlier this year, markets shifted uneasily, and the Republican president was forced into a swift U-turn.
According to reports, the action taken this week hasn’t been hugely popular within the White House. Axios reported today, citing two anonymous sources, that Treasury Secretary Scott Bessent told the president that the investigation “made a mess,” which could be bad for financial markets.
Even if the chips fall in favor of President Trump and he successfully ousts both Powell and Governor Lisa Cook, as well as managing to insert a dovish Fed chairman at the head of the table, there’s still an economic fallout to be dealt with. This could include a weaker dollar, a steeper yield curve, and higher long-term inflation expectations, according to Thierry Wizman, global FX and rates strategist at Macquarie Group. If Trump succeeds, “it may result in a Fed that will be more pliant with respect to those White House wishes, especially if Congress concedes its role. That means a Fed that keeps interest rates lower than they otherwise would be.”
This means that inflation, held in check by higher rates, may increase in the longer view and, as such, “nominal assets, such as fixed-coupon long-term bonds, will look less attractive as stores of real value.”
Politics8 years ago