Watch out Nvidia — AMD is making a major push for data center supremacy with billion-dollar ZT Systems deal
AMD is gunning for Nvidia
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AMDhasannouncedit will acquire AI infrastructure provider ZT Systems in a $4.9 billion cash and stock deal, marking a major milestone in the chipmaker’s plan to challenge Nvidia in the AI data center market.
The company says the deal will help accelerate the deployment of its AI solutions and strengthen its position in the growing AI accelerator market, which it predicts will be worth $400 billion by 2027.
Buying ZT Systems will also mean AMD will acquire over a thousand design engineers to help boost scale.
AMD uses ZT Systems to edge closer to Nvidia
AMD CEO Dr Lisa Su emphasized the strategic importance of the deal, noting it would enable the company to integrate its AI hardware, including the Instinct line of AI accelerators and EPYC CPUs, with ZT Systems’ expertise in system design.
The goal, she says, is to, “deliver end-to-end data center AI infrastructure at scale with [AMD’s] ecosystem of OEM and ODM partners.”
ZT Systems has been a critical player in building custom AI infrastructure for global tech giants likeMicrosoft, Meta andAmazonover the past few years. The company also has an existing partnership withNvidia, which is set to continue.
The transaction is expected to close during the first half of 2025, certain to customary closing conditions and regulatory approval, and marks the latest in a series of AI-focused investments including more than $1 billion to expand the AMD AI ecosystem and strengthen the company’s AI software capabilities in the last year.
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The company also acquired Finnish AI startup Silo AI last month for $665 million.
After a month of decline, AMD stock is on the rise again, up 4.5% following the ZT Systems announcement. However, while AMD’s market cap of $251.31 billion is comfortably ahead ofIntel’s, at $92.01 billion, the company lags behind Nvidia, currently the world’s second-most valuable company with a cap of $3.197 trillion.
Earlier this year, AMD alsoacquired Europe’s largest private AI lab, Silo AI, in a $700 million deal signalling a strategic expansion into theAI toolseco-system, alongside its acquisitions of Mipsology and Nod.ai.
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With several years’ experience freelancing in tech and automotive circles, Craig’s specific interests lie in technology that is designed to better our lives, including AI and ML, productivity aids, and smart fitness. He is also passionate about cars and the decarbonisation of personal transportation. As an avid bargain-hunter, you can be sure that any deal Craig finds is top value!
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