AI chip startup Tenstorrent has closed a $1.5 billion Series E funding round at a $6.2 billion post-money valuation, the company announced on October 19, 2026. The valuation is more than double the level of its previous financing in December 2024, a sign that investors still want alternatives to the largest players in AI hardware, even as the sector faces broader market scrutiny.

The round was led by Trace Capital, a firm launched earlier this year by Quiet Capital co-founder Ben Mahdavi, together with Innovation X. Other participants include Fidelity Management & Research, ARK Invest, T. Rowe Price, Tether Investments, Morgan Stanley, Sandisk and Cadence Ventures, the venture arm of Cadence Design Systems. Existing backers include Bezos Expeditions, Samsung, LG Electronics and Hyundai Motor Group.

Tenstorrent plans to use the capital to deploy its Galaxy servers at scale, keep serving open-weight models across large language models and video generation, and advance the AI and CPU intellectual property it licenses to customers that design their own silicon. The company says the funding will support volume manufacturing and global commercial expansion as chip designers, sovereign players and inference platforms move to own their AI compute.

Tenstorrent builds AI processors and systems on the open RISC-V architecture for developers, enterprises and sovereign infrastructure. Beyond selling servers and workstations, it licenses its TT-Ascalon RISC-V CPU and Tensix AI cores to chip designers, including Samsung and LG. Its open-source software stack lets developers run frontier models locally and allows enterprises to deploy models on their own premises. The company, founded in 2016 by AMD alumni Ljubisa Bajic, Milos Trajkovic and Ivan Hamer, operates from Santa Clara, Austin, Toronto, Belgrade, Tokyo and Bangalore.

The company is led by CEO Jim Keller, a veteran chip architect whose career includes work on Apple’s A4 and A5 processors, AMD’s Zen architecture and Tesla’s Full Self-Driving chip, as well as roles at Intel. Keller describes the strategy as a single architecture offered across every size of deployment, and argues that the future of compute belongs to the people who build on it, in an open and scalable form. He told Bloomberg that customers want general-purpose AI computers able to run any type of model, and that Tenstorrent can compete on price.

The company also chose to raise money rather than sell. Tenstorrent drew takeover interest earlier this year, according to Bloomberg, and media reports named Intel and Qualcomm as potential suitors, though Keller said in June that the company had not been in talks with Qualcomm. Keller told Bloomberg the company preferred new funding to a sale, and that it can serve a wide range of customers, including those with orders that are too small for larger rivals, while customizing software or hardware.

Investors also pointed to technical progress. George Bousis, co-founder and managing partner at Protagonist, said few companies design both the chip and the software that runs on it, and that Tenstorrent’s video generation results beat industry benchmarks ahead of expectations.

The raise comes as AI infrastructure spending reaches hundreds of billions of dollars and buyers look for options beyond the largest incumbents. If Tenstorrent can turn fresh capital into volume manufacturing and broader adoption of its open, RISC-V-based approach, it could become one of the more closely watched challengers in the AI chip race.