Qualcomm to Acquire Modular for Nearly $4 Billion in Strategic AI Push
The all-stock transaction, expected to close in the second half of 2026, brings co-founders Chris Lattner and Tim Davis into the Qualcomm fold as the company diversifies beyond its mobile device revenue base.
Qualcomm has announced plans to acquire Silicon Valley chip software startup Modular for nearly $4 billion, a move that signals a significant expansion of the company’s reach into the data centre market and artificial intelligence hardware. The transaction, valued at just under $4 billion based on Qualcomm’s last closing share price, will be structured through the issuance of up to 19.2 million shares of common stock. The deal also includes a $300 million component designated for Modular employees and is expected to close in the second half of 2026.
The acquisition brings Modular’s entire team of approximately 150 staff, including co-founders Chris Lattner and Tim Davis, into Qualcomm. Lattner, a prominent figure in software development known for creating the LLVM compiler infrastructure and Apple’s Swift programming language, previously worked on Google’s TPU chips and briefly led Tesla’s Autopilot software program. Davis also joined from Google, where he contributed to TPU development. The startup was founded in 2022 with the aim of creating a unifying software layer to help cloud businesses optimise GPU and CPU performance.
Modular’s proprietary coding language allows developers to write AI software that runs across different chip architectures without requiring code rewrites. This capability positions the platform as a potential challenger to established ecosystems such as Nvidia’s CUDA and AMD’s ROCm. Qualcomm president and CEO Cristiano Amon stated that the company believes the future belongs to developer-friendly, horizontal platforms that provide customers with real choice in how and where they deploy AI.
The deal marks a strategic pivot for Qualcomm, which has historically generated the vast majority of its revenues from chips for the mobile device market. Amon recently noted that the company is developing 40 different chip designs for AI-enabled gadgets, including smart glasses, jewellery, earbuds, pins, and watches. However, the acquisition underscores a growing focus on the data centre sector, which requires more powerful and versatile hardware solutions.
This purchase follows Qualcomm’s recent acquisition of Ventana Micro Systems, a startup focused on RISC-V server CPUs, and aligns with its work on custom ASIC designs for data centres. ByteDance has been reported as an early customer for these custom designs. Modular had previously raised $250 million at a $1.6 billion valuation nine months prior to the acquisition announcement, securing partnerships with major chipmakers and hyperscalers while competing against their in-house software developments.
The final valuation of the transaction may fluctuate based on movements in Qualcomm’s share price between the announcement and the deal’s closure. While the target closing date is set for the second half of 2026, the timeline for regulatory approval or other conditions precedent has not been specified. The acquisition represents a high-stakes bet by Qualcomm to secure critical software capabilities that complement its hardware ambitions in the competitive AI infrastructure landscape.
