Feb 19 (Reuters) - Lambda, a cloud computing firm

specializing in providing hardware and services to power

artificial intelligence development, has raised $480 million in

a Series D equity round from investors including Nvidia ( NVDA )

, the company told Reuters.

The round was co-led by Andra Capital and SGW, the family

office of early Google investor Scott Hassan, bringing

its total equity raised to $863 million.

The company did not disclose its valuation, but sources said

this round gave the firm a post-money valuation of $2.5 billion.

ARK Invest, G Squared, and servers provider Super Micro

also participated in the round.

Lambda offers cloud services and software designed for

training, fine-tuning, and deploying AI models. A major part of

the business is renting out servers powered by Nvidia's ( NVDA )

artificial intelligence GPUs, which has benefited from the

spiking demand for such hardware in the AI boom.

It also offers software and hosted access to enterprises to

run and deploy different AI models, including open source ones.

Lambda CEO and co-founder Stephen Balaban said the company

has seen much growth in the deployment of open source models,

including China's DeepSeek.

"Lambda is really well positioned as a company to take

advantage of open source AI models like DeepSeek-R1 because we

have well over 25,000 GPUs on our cloud platform that can be

readily repurposed to host these open source models," he said in

an interview.

The launch of DeepSeek-R1 last month significantly

accelerated demand for Nvidia H200 chips from its clients,

according to Balaban. Enterprises are pre-purchasing large

blocks of Lambda's H200 capacity even before public

availability.

He added the new investment would be used to purchase more

Nvidia ( NVDA ) chips for its cloud platform, as well as expansion of its

software products including Model Inference API, and its Chat AI

Assistant.

Founded in 2012 by a group of AI engineers, Lambda's

hardware and cloud business serves over 5,000 customers across

industries including manufacturing and financial services, as

well as the U.S. government.