AMD is also bringing its latest AI chip (Instinct MI325X), which could rock the AI chip market. An event on Thursday revealed this powerful processor, which serves up a direct salvo at Nvidia’s stranglehold on the data center GPU market. Nvidia’sAccording to the MI325X, popular GPUs were expected to go into production by the end of 2024 and could be an alternative for developers and cloud providers.
A successful chip launch would put AMD on the cusp of taking market share from Nvidia. This company has seen a lot of demand for its chips due to the bifurcation present in the data center with forward-looking use cases driving generative AI tools like ChatGPT. This chip is a big piece of AMD’s strategy to play a role in what the company says will be a $500 billion AI chip market by 2028.
AMD AI Chip MI325X enters the $500 billion market
For years, AMD has trailed Nvidia in the AI GPU market—a problem that the MI325X represents a step toward solving. Despite Nvidia controlling over 90 percent of the market, thanks to its highly efficient and sought-after GPUs used to power data centers worldwide, a new competitor may be emerging. Nevertheless, AMD has been eating away at the space between itself and Team Red in this race, most recently with the MI325X.
However, while AMD’s new chip isn’t a successor to the MI300X, to be specific, it’s also a timely debut as Nvidia readies its next-generation Blackwell chips for the end of the year. The new MI325X will likely be pitched against Nvidia’s offerings and could generate pricing competition, benefiting data center operators and AI developers. AMD doesn’t have a price point for the MI325X yet, but it seems clear the company wants to harness the GPU maker’s release frequency.
What the MI325X brings to the table
The Instinct MI325X met the increased need for AI processing power, specifically for large-scale generative AI models like OpenAI’s ChatGPT. AMD CEO Lisa Su said demand for AI is exploding, and investments are still going over the top in terms of what people expected. With this increased demand, AMD has had to fast-release its products to capture a larger portion of the market.
AMD has nabbed big customers for its Instinct series of GPUs—Meta and Microsoft, for example—without securing new major ones. Meta’s Llama AI model performs better on the company’s chips because AMD has more advanced memory. With the MI325X offering 40 percent more inference performance on Llama 3.1 than Nvidia’s H200 chip, some developers might lean away from Nvidia’s ecosystem, says Su.
Challenging more than just Nvidia
AMD’s most prominent competition is not just between Nvidia and it in the AI chip market—as that battle garners some of the most headlines—but with Intel in the CPU market. AMD’s bread and butter have been central processors (CPUs), and the introduction of the 5th Gen EPYC CPUs is an attempt to broaden the company’s play.
The new CPUs cover the low-power, low-cost portion of the market up to supercomputer grade, with prices ranging from $527 to $14,813 per chip. AMD says these processors are suited to feed data into AI workloads, an important capability in modern data centers. AMD admits to trying to compete with Nvidia in the GPU realm and Intel in the broad data center market.
AMD aims to become a major player in AI chips as the semiconductor industry grows. The company’s new strategy of releasing chips yearly could help it compete with Nvidia. Its work on improving its software could make it easier for developers to switch to AMD products.
But the company still has problems. Nvidia’s CUDA language is the standard in AI, making it hard for developers to switch. To counter this, AMD is improving its software to help developers move their AI models to AMD chips. It’s not yet clear if this will help AMD gain market share, but the launch of the MI325X shows that AMD is serious about competing.
AMD’s share price fell slightly after the announcement, but this launch could be a turning point for the company as it aims to capture more of the AI chip market. The real test will be when the MI325X is shipped, and the tech community can see how it compares to Nvidia’s Blackwell chips. AMD is pushing into AI chips and continuing to work on CPUs. It wants to be a top competitor, but it’s unclear if it can dethrone Nvidia or Intel.
Image credit: AMD/YouTube
