AMD is making waves in the AI chip market, following in the footsteps of Nvidia.
The company's second quarter 2024 earnings reveal a seismic shift: nearly half of AMD's sales now come from data center products, thanks to the phenomenal success of its AI chips.
A Billion-Dollar Quarter
AMD's data center business has doubled in just one year, largely due to the AMD Instinct MI300 accelerator. This AI chip raked in over $1 billion in sales in a single quarter, up from $1 billion cumulatively since its debut in December 2023. CEO Lisa Su also credited the Epyc server CPUs for contributing to this impressive growth.
Following Nvidia’s Footsteps
Nvidia has set the gold standard in AI chips with its H100, and AMD is keen to catch up. The company plans to release new AI chips annually, with the MI325X coming later this year, the MI350 in 2025, and the MI400 in 2026. Su mentioned that the MI350 is expected to be "very competitive" with Nvidia’s Blackwell, touted as the world's most powerful AI chip.
Despite supply chain improvements, Su noted that "supply will remain tight through 2025," indicating strong demand for AMD’s AI chips.
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The Bigger Picture
While AMD's data center business is booming, it’s still a fraction of Nvidia's, which reported $22.6 billion in quarterly data center revenue. However, AMD's growth is a promising sign for the industry. The influx of AI dollars could accelerate advancements in GPU architecture, benefiting other sectors like gaming and personal computing.
Impact on PC Gamers
Interestingly, AMD's personal computing CPU and GPU businesses also saw growth. Ryzen CPUs were up 49% year over year, and Radeon 6000 GPUs increased sales despite a decline in gaming revenue due to lagging PlayStation and Xbox sales.
For those eagerly awaiting AMD Zen 5 laptops, Su confirmed that more than 100 different "platforms" are set to ship with Ryzen AI 300 "Strix Point" chips. While only a few models from Asus, HP, and MSI have hit the shelves, Acer and Lenovo are also on board.
What’s Next?
AMD's transformation into an AI chip powerhouse marks an exciting chapter for the company and the industry. As AMD continues to innovate and compete with Nvidia, the future looks bright for AI advancements and their trickle-down benefits to other tech sectors.
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