Could Intel Be Considering Another AI Acquisition?

Article By : Sally Ward-Foxton

Rumors abound that Habana Labs may be in discussions with the computing giant — which already owns Nervana.

Rumors are rife that Intel is in talks to acquire Israeli AI accelerator startup Habana Labs. Intel is reportedly considering a purchase price of ranging anywhere from $1 billion to $2 billion, according to the Israeli publication Calcalist, who broke the story earlier this week.

If it’s true, it would be a surprising move, given that Habana competes with Intel acquisition Nervana. Nervana, based in San Diego, was purchased by Intel back in August of 2016 for a sum believed to be around $400 million. Intel acquired another AI chip startup, Movidius, the following month (Movidius’ product line is aimed at computer vision in edge devices).

Habana’s Goya and Gaudi chips directly compete with Nervana’s NNP-T and NNP-I chips, which debuted amid much fanfare just over a fortnight ago. Both Habana and Nervana offerings target training and inference in the data center.

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Intel’s Nervana NNP-T and NNP-I devices are aimed at AI training and inference in the data centre (Image: Intel)

Would this third AI silicon acquisition be a sign that Intel hasn’t got its AI silicon offering right yet?

“Perhaps, but it is also indicative of the importance of AI in the future computing landscape,” said Karl Freund, Analyst at Moor Insights and Strategy. “Intel has to get this right. If Nervana was a mistake from a hardware perspective, it [would be] best to correct that now and pursue a platform with a durable architectural advantage.”

Where would a potential Habana Labs acquisition leave Nervana? There is a possibility that Intel could decide to sideline the NNP-T and NNP-I product families in favour of Habana’s offering.

Freund notes that even without its hardware, Nervana would still contribute, since many consider Nervana’s key value to lie in its software.

“Nervana brought a rich set of AI software, which is a durable asset for Intel,” he said.

There is another option: Intel may choose to take both Nervana and Habana Labs hardware solutions to market, said Kevin Krewell, principal analyst, Tirias Research.

“I expect that if the deal happens, Intel will offer both solutions and let the market decide which architecture gets the most traction,” said Krewell. “At this time in AI, it’s hard to pick the long-term winner.”

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Habana Labs’ Gaudi device, launched in June 2019, set records for ResNet-50 performance at the time (Image: Habana Labs)

Habana Labs may simply be too attractive a target to pass up, Krewell explained.

“Habana has produced some good early MLPerf benchmark numbers and has a good relationship with companies such as Facebook,” said Krewell. “What may [also] interest Intel is the team at Habana. Intel has a strong engineering presence in Israel and the Habana team would be a good addition to Intel’s existing engineering resources there.”

Habana Labs, based in Tel Aviv, was founded in 2016 and employs around 150 people in several offices worldwide. A series B round of financing led by Intel Capital closed a year ago, raising $75m, which brings the company’s total funding to $120m.

Intel previously acquired another Israeli chip startup, Mobileye, in March 2017 for a hefty $15.7bn.

An Intel spokesperson declined to comment, saying only that the company “does not respond to rumors.” At the time of writing, Habana Labs had not responded to a request for comment.

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