AMD’s Piece of the AI Pie Will Need to Prove Sticky
Advanced Micro Devices has been defying the odds for years now. So it isn’t a great stretch to imagine the chip maker doing so again. The company more commonly known as AMD long competed primarily against Intel for a small slice of the personal computer and server markets.
AMD’s fortunes began to brighten about five years ago thanks to smart design decisions, plus technological stumbles by its much larger rival. AMD now generates more than four times the annual revenue that it did in 2017; Intel’s business has shrunk by 16% in that same time. But AMD now has a much more ascendant rival to face.
Generative artificial intelligence has remade Nvidia’s business even faster, more than doubling the company’s revenue in just a year. And that won’t be a flash in the pan, as Nvidia has spent years building up the AI chip and software technology that has made it the gold standard for powering the generative AI workloads that have come in such hot demand this year following the launch of ChatGPT. Analysts now expect Nvidia’s annual revenue to surpass $108 billion by the end of 2025—a fourfold increase in just three years.
Hence, much is expected of the new AI chips AMD unveiled on Wednesday, and the company isn’t being shy about going after its newest rival. During an event just a few miles from Nvidia’s Silicon Valley headquarters, every slide in AMD’s deck touting the performance of its new MI300 system compared its performance to Nvidia’s flagship H100 family. AMD has even taken the unusual step of projecting sales for a specific product line, saying it expects its MI300 products to generate $2 billion in revenue next year—the chip family’s first full year on the market.
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