Key facts
- Modal will use Nvidia's new Vera central processor for AI agents.
- Nvidia expects to generate at least $20 billion from Vera chip sales this fiscal year.
- Modal raised $750 million in a funding round at a $15.75 billion valuation.
Nvidia has secured central processor chip business from AI startup Modal, marking an early success in its bid to challenge Intel and AMD in a market they have long controlled. Modal, a cloud-computing startup, announced it will begin using Nvidia's new Vera central processor for hosting AI agents, a task previously handled exclusively by Intel and AMD chips. This development comes after Modal recently raised $750 million at a $15.75 billion valuation and reported a tripling of service usage and a more than 15-fold increase in revenue year-over-year. Early tests indicated that the Nvidia chip could double the output of AI agents, prompting Modal to adopt the new design despite requiring significant software adjustments. Modal's CEO, Erik Bernhardsson, emphasized that the company will maintain a mixed fleet of hardware, utilizing whichever chips perform best for each job, and will test new offerings from Intel and AMD as they become available. Nvidia anticipates generating at least $20 billion from Vera chip sales in the current fiscal year, targeting a market valued at approximately $200 billion, and has previously stated that OpenAI, Anthropic, Oracle, and Perplexity also plan to use its chips.