By Stephen Nellis, Chavi Mehta
(Reuters) -Advanced Micro Devices’ production of a new artificial intelligence chip to challenge market leader Nvidia Corp will ramp up in the fourth quarter, the company said on Tuesday.
AMD Chief Executive Lisa Su at an event in San Francisco said the new MI300X chip will have 192 gigabytes of memory, more than any current Nvidia chip and a key performance measure for how well the chip will handle the large AI systems behind services similar to ChatGPT.
“There’s no question that AI will be the key driver of silicon consumption for the foreseeable future,” Su said.
Su said customers will get sample chips in the third quarter, with production rising toward the end of the year.
Nvidia jumped 3.9% to $410.22, becoming the first chipmaker to end a trading session with a market capitalization above $1 trillion after smaller rival Advanced Micro Devices gave the update on its artificial intelligence strategy that failed to impress investors. AMD dropped 3.6%.
AMD’s company shares, however, have doubled since the start of the year, rising on optimism on businesses investing in AI, and touched a 16-month high earlier in the day.
Su also touted a system that combines eight of its MI300X chips into a single computer, competing against similar offerings from Nvidia.
The company also said it has started shipping high volumes of a general purpose central processor chip called “Bergamo” to companies such as Meta Platforms. Alexis Black Bjorlin, who oversees computing infrastructure at Facebook parent Meta, said the firm has adopted the Bergamo chip, which targets a different part of AMD’s data center business that caters to cloud computing providers and other large chip buyers.
Nvidia, whose shares have surged 170% so far this year, dominates the AI computing market with 80% to 95% of market share, according to analysts.
Nvidia has few competitors working at a large scale. While Intel Corp and several startups such as Cerebras Systems and SambaNova Systems have competing products, Nvidia’s biggest sales threat so far is the internal chip efforts at Alphabet Inc’s Google and Amazon.com’s cloud unit, both of which rent their custom chips to outside developers.
Nvidia’s lead has come not just from its chips, but from more than a decade of providing software tools to AI researchers and learning to anticipate what they will need in chips that take years to design. AMD on Tuesday provided updates to its Rocm software, which competes against Nvidia’s Cuda software platform.
“People still aren’t convinced that AMD’s software solution is competitive with Nvidia’s even if it is competitive on the hardware performance side,” said Anshel Sag, an analyst at Moor Insights & Strategy.
Soumith Chintala, a Meta vice president who helped create open-source software for artificial intelligence, during the presentation said he has worked closely with AMD to make it easier for AI developers to use free tools to switch from the “single dominating vendor” of AI chips to other offerings like those from AMD.
“You don’t actually have to do that much work – or almost no work in a lot of cases – to go from one platform to the other,” Chintala said.
(Reporting by Stephen Nellis in San Francisco; Editing by Leslie Adler, David Gregorio, Nick Zieminski and Mark Porter)
