Tensordyne's Napier chip is designed to accelerate AI inference. Since about 2020, AI has largely focused on training bigger and better models. Large language models (LLMs) ballooned from millions of parameters to trillions. This proved effective: The largest version of Open AI's GPT-3, released in 2020, correctly answered just 43.9 percent of questions on a popular knowledge-and-reasoning benchmark. Just four years later, GPT-4o reached a score of 88.7 percent on the same exam, effectively matching those of human experts. Advanced AI labs are still training ever larger models, but that training has somewhat receded to the background of the AI conversation. In 2026, inference—the use of trained models to produce code, write essays, or make images of ourselves as elves—has come to the forefront.

"It's like training is yesterday's news," says Matt Kimball, principal data-center analyst at Moor Insights & Strategy. "All that any chief information officer wants to talk about is inference." Nvidia CEO Jensen Huang, speaking at the company's GTC 2026 conference, touted this change as the "inflection point of inference."

Part of what's caused the shift is very simple: LLMs are becoming useful, so people are using them. On top of that, many models on the market today are reasoning models. In response to a user's query, they run inference not just once but multiple times, reprompting themselves in a process called chain of thought. Reasoning models generate longer outputs, and models with high reasoning effort can produce up to 20 times as much text as those with low or no effort.

The resulting explosion in inference demand has led to unexpected alliances among tech giants. Open AI and Amazon have deployed chips the size of a dinner plate designed by Cerebras, despite Amazon having its own Trainium chips. Nvidia bought key talent and intellectual property from AI-inference startup Groq in a controversial deal worth US $20 billion. And Anthropic is paying LLM competitor Space XAI over a billion dollars per month to lease spare compute.