Microchip startup Nuvacore is seeking to raise hundreds of millions of dollars at a valuation of approximately $2.5 billion, according to two people familiar with the fundraising. The six-month-old company, based in San Jose, California, is developing a new central processing unit (CPU) intended for use in data centers.
The company previously announced a seed funding round led by Sequoia Capital earlier this year. Its founders include Gerard Williams, a former Apple executive who sold his previous startup, Nuvia, to Qualcomm for $1.4 billion in 2021, as well as engineers John Bruno and Ram Srinivasan. The current funding round has not yet closed, and sources cautioned that the final valuation and capital amount remain subject to change.
Nuvacore has not yet released a product but described a strategy last month to build core chip functionality before selecting a specific architecture. This approach is intended to avoid the limitations of established designs like Intel’s x86 or Arm technology. The startup aims to optimize its hardware for the computations common in artificial intelligence infrastructure and data centers, where CPUs act as controllers for AI chips and run autonomous software agents.
The outcome of this fundraising and Nuvacore’s subsequent development will affect the competitive landscape for data center operators and cloud providers who currently rely on established manufacturers. Intel and Advanced Micro Devices (AMD) currently dominate the market with x86 technology, while Amazon and Microsoft use custom chips based on Arm technology. Both Intel and AMD have reported strong demand this year, with their share prices rising more than 180% in 2026, though Intel reported it could not manufacture enough chips to meet all orders.
Nuvacore’s entry follows other major industry moves, such as Nvidia’s launch of its Vera CPU this year, which the company expects to generate $20 billion in revenue for the fiscal year ending in January. If Nuvacore successfully closes this round, it will join a group of young semiconductor firms securing billion-dollar valuations based on the demand for AI-related infrastructure. The next steps for the company include closing the funding round and completing the design of its processor, though specific release dates for a physical product were not reported.