AMD launches new AI chips to take on leader Nvidia

Advanced Micro Devices (AMD.O) unveiled its latest artificial intelligence processors on Monday, outlining a two-year roadmap to challenge industry leader Nvidia (NVDA.O).

At the Computex technology trade show in Taipei, AMD CEO Lisa Su introduced the MI325X accelerator, scheduled for release in the fourth quarter of 2024. The escalating demand for advanced chips in AI data centers, driven by the development of generative artificial intelligence programs, has intensified the competition between AMD and Nvidia, the latter commanding about 80% of the AI semiconductor market.

AMD has adopted an annual release cycle for its products, following Nvidia’s lead from last year. “AI is clearly our number one priority as a company, and we have really harnessed all of the development capability within the company to do that,” Su told reporters. She emphasized the necessity of introducing new products and capabilities annually to maintain a competitive portfolio.

AMD also announced the MI350 chip series, expected in 2025, featuring a new architecture and anticipated to perform 35 times better in inference than the current MI300 series. Additionally, the MI400 series, set for 2026 release, will be based on an architecture named “Next.”

Nvidia’s CEO Jensen Huang revealed that their next-generation AI chip platform, Rubin, would be available in 2026, incorporating GPUs, CPUs, and networking chips. Investors, heavily investing in the booming genAI sector, are keenly watching for long-term updates from chip companies.

Despite AMD’s shares remaining flat and Nvidia’s rising over 3% on Monday, AMD has more than doubled its value since the start of 2023. However, this increase is overshadowed by Nvidia’s over seven-fold rise in the same period. “While the proof will be in the pudding, there’s no doubt that AMD is taking Nvidia heads-on and companies looking for alternatives to Nvidia are bound to be happy to hear what AMD had to say,” said Technalysis Research chief analyst Bob O’Donnell.

Su stated in April that AMD anticipates AI chip sales of approximately $4 billion for 2024, up $500 million from previous estimates. At Computex, AMD announced that its latest generation of central processor units (CPUs) would likely be available in the second half of 2024.

While AI chips for data centers are a priority, some of AMD’s CPUs will be used with graphics processor units (GPUs), though GPUs remain the dominant component. AMD also outlined the architecture for its new neural processing units (NPUs), designed for on-device AI tasks in AI PCs. PC makers such as HP (HPQ.N) and Lenovo (0992.HK) plan to release devices incorporating AMD’s AI PC chips, which exceed Microsoft’s (MSFT.O) Copilot+ PC requirements.

Chipmakers are banking on enhanced AI capabilities to stimulate growth in the PC market, which is recovering from a prolonged downturn.

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