Nvidia Is in Talks to Buy Reflection AI, a Startup It Already Backs

Companies that train AI models are among the important buyers of Nvidia's chips. Saturday's report says one of those customers could end up inside Nvidia.

On October 10 the Financial Times reported that Nvidia is in early talks to deepen its investment in Reflection AI or buy it outright. Reuters said it could not independently verify the report, and neither company commented.

Reflection Gained 46-Fold in Three Rounds

Reflection was founded in 2024 by two former DeepMind researchers, Misha Laskin and Ioannis Antonoglou. It builds AI systems that write code and carry out tasks on their own.

The valuation climbed fast. PitchBook data put it at $545M in March 2025; a $2B round led by Nvidia in October 2025 lifted it to $8B. In April, Laskin said the company was raising new capital at a $25B pre-money valuation.

On October 5 the company released Beam, its first open-weight model. The 501-billion-parameter model aims to compete with cheaper Chinese models such as DeepSeek and Kimi in coding and agentic work.

The Seller Moves Closer to Owning Its Customer

Under a contract signed in June, Reflection rents Nvidia GB300 chips in SpaceX's Colossus 2 data center. It pays $150M a month from July 2026 through the end of 2029, roughly $6.3B in total.

The market may read this as a software acquisition. On Nvidia's balance sheet it would look like the purchase of a customer.

Today the risk in this loop sits with Reflection's investors. In a full takeover, it moves onto Nvidia's income statement: a model company paying someone else to rent Nvidia's own chips.

Nvidia's Stake Portfolio Grew in Six Months

Reflection is not an isolated case. Nvidia's quarterly report (10-Q) for the period ended July 26 shows $99B of equity investments and another $25B of investment commitments.

Equity purchases rose 34-fold in a year. Over the same period, cash from operations was $74.4B. An amount equal to 57% of the cash Nvidia generated went into other companies' shares.

Non-marketable securities, holdings in companies that are not publicly traded, rose from $22.3B to $51.2B.

Nvidia's cash can carry this pace. It holds $56.6B in cash and short-term debt securities. A $25B deal would equal 44% of that and 34% of first-half operating cash flow.

Full Takeover or Team Transfer?

The FT lists three paths: a full acquisition, hiring the team while licensing the technology, or a larger minority stake. The second is described as a way to avoid a lengthy antitrust review.

Nvidia tried that path with Groq in December 2025. In a roughly $20B "non-exclusive licensing" deal, Groq founder Jonathan Ross and his team moved to Nvidia. Nvidia's 10-Q shows a $2.9B payment on that line.

That route no longer escapes scrutiny. The New York Times reported in September that the Justice Department sent Nvidia a formal request for information on the Groq deal. In February, FTC Chairman Andrew Ferguson said such deals must be "not an attempt to get around" merger review.

What Is Still Unknown

There is no price, no agreed structure, and the FT says talks could still collapse. The report came out on a Saturday, so markets have not priced it; the first reaction comes at Monday's open.

The scale should not be overstated either. $25B is close to the $24.1B of operating cash Nvidia generated in its second quarter. It tests the company's capital allocation choices, not its balance sheet.

What It Means for Investors

• Nothing is priced yet; Monday's move in Nvidia will show whether investors treat such deals as growth or as cash leakage.
• If Nvidia owns a rival model maker, its model-building customers may diversify suppliers, which could read positively for AMD and Broadcom.
• The figure to watch is equity investment as a share of operating cash in the November third-quarter report; a rise from 57% means the loop is growing.
• The thesis-breaking risk is regulatory: if the Justice Department widens its Groq probe, the team-transfer route closes and every deal faces a long review.

Sources: The acquisition talks are based on the Financial Times report of October 10 and Reuters' account of it; Reuters could not independently verify the report. Nvidia's investment, cash and Groq payment figures come from its 10-Q for the period ended July 26, 2026, filed with the SEC. Reflection's valuation history draws on AI Business and PitchBook data; the SpaceX contract on figures reported by CNBC and published by Quartz; the Justice Department probe on the New York Times' reporting.