(Bloomberg) -- Graphcore Ltd., the British chipmaker that aimed to challenge Nvidia Corp., said it needs to raise money to continue operating as a “going concern” after racking up losses. 

The company is in talks with potential investors, but hasn’t yet reached an agreement, it said in a filing of its 2022 accounts on business registry Companies House on Wednesday. Pretax losses widened 11% to $204.6 million from a year earlier, and Graphcore ended the year with cash and short-term investments of $157 million, it said in the statement.

Graphcore, which specializes in semiconductors designed to run artificial intelligence programs, also said it had closed its offices in Norway, Japan and South Korea and reduced employees to 494 at the end of 2022 from 631 a year earlier. Revenue fell 46%, particularly hit by a loss of sales from China after a major customer delayed orders. 

Read More: Nvidia AI Rival Graphcore Looks to China for Growth

A representative for Bristol, England-based Graphcore declined to comment. 

Founded in 2016, Graphcore was one of Britain’s most promising startups when it raised $222 million at a $2.8 billion valuation two years ago. Still, the company’s specialist semiconductors have struggled to gain traction, even as much larger rival Nvidia surged thanks to the growth in AI use. The company, which is run by co-founder Nigel Toon, said that the deteriorating economic environment last year hurt progress in hardware sales.

Venture capital firm Sequoia Capital wrote down the value of its stake in Graphcore to zero, the Sunday Times newspaper reported earlier this year. 

©2023 Bloomberg L.P.