AMD on Monday mentioned it plans to accumulate server maker ZT Techniques for US$4.9-billion (R87-billion) as the corporate seeks to broaden its portfolio of synthetic intelligence chips and {hardware} and battle Nvidia.
AMD plans to pay for 75% of the ZT Techniques acquisition with money and the rest in shares. The corporate had $5.3-billion in money and short-term investments as of the second quarter.
The computing necessities for AI have dictated that tech corporations string collectively hundreds of chips in clusters to attain the required quantity of knowledge crunching horsepower. Stringing collectively the huge numbers of chips has meant the make-up of complete server programs has turn into more and more necessary, which is why AMD is buying ZT Techniques.
AMD’s shares climbed almost 3% in premarket buying and selling.
“AI programs are our primary strategic precedence,” AMD CEO Lisa Su mentioned in an interview in regards to the acquisition.
The addition of ZT Techniques engineers will permit AMD to extra rapidly check and roll out its newest AI graphics processing models (GPUs) on the scale cloud computing giants comparable to Microsoft require, Su mentioned. “The primary means ZT Techniques is additive to the corporate is we promote extra GPUs.”
AMD plans to interrupt off its server manufacturing enterprise and promote it as soon as the deal closes, because it has no plans to compete with corporations comparable to Tremendous Micro Laptop, Su mentioned. AMD has not but held talks with potential consumers.
ZT Techniques CEO Frank Zhang will be part of AMD and report back to AMD’s information centre chief, Forrest Norrod.
AI chips
The intently held ZT Techniques has about 2 500 staff, of which AMD plans to retain a couple of thousand engineers. At the moment ZT Techniques generates annual income of about $10-billion, Su mentioned.
Executives anticipate the deal to shut within the first half of 2025 and anticipate an extra 12-18 months to promote the manufacturing enterprise.
Nvidia CEO Jensen Huang mentioned on the firm’s developer convention in March that the one-time chip designer now creates and sells total information centres, or the person elements wanted to construct one. This 12 months analysts anticipate the corporate to generate $105.9-billion from its information centre section, which incorporates chips and different AI {hardware}.
Su mentioned final month the corporate expects to gather $4.5-billion value of AI chip income this 12 months. The corporate’s prospects embrace Microsoft and Meta Platforms. — Max A Cherney,(c) 2024 Reuters
