Nvidia Corp. could reportedly make an investment in startup Lambda Inc., which operates a public cloud powered by the chipmaker’s graphics cards.

San Francisco-based Lambda also sells on-premises data center hardware and developer laptops. 

The Information reported Nvidia’s potential investment in the startup today, citing sources familiar with the matter. Nvidia and Lambda are said to be close to finalizing the funding round. It’s believed that the deal would see the startup receive up to $300 million at a post-money valuation of $1 billion.

Lambda previously raised about $112 million in funding from investors. Its most recent round, a Series B investment that was disclosed in March, included the participation of Google LLC’s Gradient Ventures fund and more than a half-dozen other backers. The company said at the time that it would use the capital to enhance its cloud platform.

Lambda’s platform provides access to Nvidia graphics cards that customers can use to train artificial intelligence models and perform inference. The startup’s GPU catalog includes, among others, Nvidia’s flagship H100 data center chip. The H100 features 80 billion transistors that allow it to run large language models up to 30 times faster than its predecessor.

Lambda’s public cloud isn’t its sole offering. The startup also provides colocation services that allow companies to keep their servers at its data centers. If a customer-owned system experiences a malfunction, Lambda engineers can help fix it.

The startup also has a presence in the on-premises hardware market. It sells a family of AI-optimized appliances, called the Echelon series, that customers can order with the H100 or other Nvidia chips. Echelon systems also include storage and network gear, as well as preinstalled machine learning software.

Rounding out Lambda’s product portfolio is a pair of personal computers for AI developers. The first machine combines four Nvidia graphics cards with up to 61 terabytes of storage, 1 terabyte of memory and a high-end central processing unit from either Intel Corp. or Advanced Micro Devices Inc. Lambda also offers a GPU-powered laptop it designed in collaboration with Razer Inc., a major PC maker.

The report that Nvidia could invest in the startup comes a few months after it backed rival CoreWeave Inc., which operates a similar GPU-powered cloud platform. Like Lambda, CoreWeave designed its platform primarily for companies building AI models. The latter startup has raised more than $570 million to date from Nvidia and other investors. 

Last week, The Information reported CoreWeave’s annual revenue is on track to reach $600 million. That’s a significant increase from the $25 million in sales the company is believed to have logged last year. 

Image: Lambda