Jakarta, CNBC Indonesia – AMD launched a new artificial intelligence (AI) chip called Instinct MI325X. The US giant specifically competes with Nvidia’s data center graphics processor (GPU) called Blackwell.
The Instinct MI325X is planned to start production before the end of 2024.
Since AMD’s AI chips are seen as replacements for Nvidia products, this could put pricing pressure on Nvidia. Even though Nvidia has the upper hand by enjoying a gross margin profit of around 75% from its GPUs, the demand for which has increased over the past year.
Nvidia’s Blackwell chip was introduced last March and is said to be sold in the price range of US$ 30,000-40,000 (Rp. 468-624 million). Nvidia CEO Jensen Huang said the chip was already attracting interest from several technology giants developing AI technology.
Advanced generative AI like OpenAI’s ChatGPT requires large data centers full of GPUs to perform the necessary processing. This is what then makes demand for AI chips soar.
In recent years, Nvidia has dominated much of the data center GPU market, and AMD has historically been a close second. Now, AMD aims to take over market share from its competitors in Silicon Valley or at least control a large part of the market, which they say will be worth US$500 billion by 2028.
“Demand for AI is actually continuing to increase and is truly exceeding expectations. It is clear that the level of investment continues to grow everywhere,” said AMD CEO Lisa Su, quoted from CNBC International, Friday (11/10/2024).
AMD didn’t reveal any new major cloud or internet customers for its Instinct GPUs at the event, but the company has previously revealed that Meta and Microsoft are buyers of its AI GPUs and that OpenAI is using them for some applications.
AMD did not reveal pricing for the Instinct MI325X.
With the launch of the MI325X, AMD accelerated its product schedule to release new chips on an annual schedule to better compete with Nvidia and capitalize on the surge in AI chips.
The new AI chip is the successor to the MI300X which started shipping late last year. AMD’s 2025 chip will be called MI350, and its 2026 chip will be called MI400, the company said.
The launch of the MI325X will compete with Nvidia’s upcoming Blackwell chips, which will start shipping in large quantities early next year.
(fab/fab)
Watch the video below:
Video: Indosat opens up about the stock split action
AMD Takes Aim at Nvidia’s Dominance: The Emerging AI Chip War
The tech industry has been abuzz with the recent launch of AMD’s newest artificial intelligence (AI) chip, the Instinct MI325X. This move is seen as a direct challenge to Nvidia’s stronghold on the data center GPU market, particularly with its Blackwell chip. As the demand for AI technology continues to skyrocket, the stakes have never been higher for these two industry giants.
The Instinct MI325X is set to start production before the end of 2024, which could potentially put pressure on Nvidia’s pricing strategy. Nvidia’s Blackwell chip, introduced last March, boasts a hefty price tag of $30,000-$40,000. While Nvidia’s CEO Jensen Huang has reported interest from major tech players, AMD’s entry into the market could force Nvidia to reevaluate its pricing.
One of the key factors driving the demand for AI chips is the growth of advanced generative AI, such as OpenAI’s ChatGPT. These technologies require massive data centers equipped with GPUs to process the vast amounts of data needed to power AI applications. This has created a lucrative market for AI chip manufacturers, with Nvidia currently holding the top spot.
However, AMD has historically been a close second in the data center GPU market, and the launch of the Instinct MI325X could be a game-changer. With its own AI chip, AMD is poised to snatch market share from Nvidia, potentially disrupting the latter’s dominance.
But can AMD really challenge Nvidia’s position? While Nvidia’s gross margin profit of around 75% from its GPUs is an impressive feat, AMD’s entry into the market could force Nvidia to reassess its pricing strategy. Nvidia’s Blackwell chip may be a highly sought-after product, but its steep price tag could make it vulnerable to competition from AMD.
The coming months will be crucial in determining the outcome of this AI chip war. As AMD ramps up production of the Instinct MI325X, the market will be watching closely to see if Nvidia responds with price cuts or if AMD is able to gain significant ground. One thing is certain – the competition in the AI chip market is about to get a lot fiercer.
What to Watch For:
- Pricing Strategy: Will Nvidia respond to AMD’s entry into the market with price cuts or maintain its current pricing strategy?
- Market Share: Can AMD gain significant ground on Nvidia and snag a larger share of the AI chip market?
- Production Ramp-Up: Can AMD successfully ramp up production of the Instinct MI325X to meet growing demand?
- Technological Advancements: How will both Nvidia and AMD continue to innovate and improve their AI chip offerings?
The stakes are high, and the battle for dominance in the AI chip market has only just begun.