Artificial intelligence startup SambaNova Systems is considering a $500 million funding round after negotiations to sell to Intel Corp. fell apart. The talks, which would have been a major acquisition for the chipmaker, stalled without a deal. This move signals a strategic pivot for the company, which was founded by former Oracle executives.

The stalled sale talks highlight the fierce competition for AI hardware startups. Intel has been aggressively acquiring companies to bolster its AI and chip manufacturing capabilities. For SambaNova, a standalone funding round would provide capital to compete against rivals like Cerebras and SambaNova itself, which designs specialized AI chips and systems.

Investors will watch whether SambaNova can secure the full $500 million and at what valuation. The funding environment for AI hardware has tightened, making this a critical test. A successful raise would validate its technology, while a failure could force a more strategic partnership or a lower-priced acquisition in the future.