Graphcore, a British startup building artificial intelligence chips, is struggling to stay afloat amid falling revenues and rising losses. The startup has warned of needing to raise money to continue as a “going concern.”

Graphcore hinted at its struggles in its 2022 annual accounts filing with the British Companies House, released on Wednesday. The company reported an annual loss of $199mn, up 18% from the previous year, and a mere $2.7mn in revenue, down 46% from 2021.

Graphcore said it’s in talks with potential investors to raise more money but hasn’t reached a definitive agreement. The Bristol-based startup has raised over $700mn from investors like Sequoia Capital, Atomico, and Dell Technologies Capital. An April report from The Times said Sequoia slashed the value of its Graphcore stake to zero. The chip startup reported having $157mn in cash and short-term investments at the end of 2022.

• Graphcore is struggling at a merry period for artificial intelligence-related companies. Nvidia (NASDAQ: NVDA), the dominant AI chipmaker, reported a record $13.5bn in sales in its latest fiscal quarter ended July 2023, up 101% from the same quarter last year. Unlike Nvidia, an established competitor, Graphcore’s chips have struggled to gain traction, generating just a few million dollars in revenue.

• Graphcore closed its offices in Japan, Norway, and South Korea and cut its headcount to 494 at the end of 2022 from 631 a year earlier. Revenue fell by almost half due to delays from a major trial customer.

Graphcore was founded in 2016 and was crowned one of the UK’s most promising startups, thanks to its blue-chip venture capital backers. It last raised $222mn at a $2.8bn valuation in 2020.

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