News AMD aims to catch up to Nvidia in AI battle with $4.9B acquisition — chipmaker strengthens AI ecosystem with ZT Systems' expertise in server design

[Admin]

Advanced Micro Devices (AMD) is acquiring a significant designer and manufacturer of servers and other infrastructure equipment for AI data centers to help it catch up with Nvidia.

AMD aims to catch up to Nvidia in AI battle with $4.9B acquisition — chipmaker strengthens AI ecosystem with ZT Systems' expertise in server design : Read more

 

[DavidLejdar]

Where ZT Systems started at, that's where a number of companies moved their datacenters to, in the 90s. I.e. NYSE and NASDAQ have their datacenters there as well. That's on a bit different level, than just "office server B2B". And sure sounds like there is a lot of expertise there (system engineering).

Not sure, I would go all-in on AMD stock though. ZT's solutions do have hardware from Nvidia, Intel, and AMD. I.e. "the XPO200-3UA PCIe Expansion System featuring AMD technology", lists 2 x AMD EPYC™ 7551 and 4 x AMD MI25. And if a lot of the purchases were from AMD, while AMD might somewhat wind down ZT's manufacturing part (as to not compete with clients of theirs), or sell it in parts, or such - then that might not fit well together.

 

[bit_user]

If AMD's bigger problems penetrating the AI and HPC space is lack of mindshare and market access, then buying an integrator like this should definitely help. Assuming AMD's offerings are competitive, adding them to this company's offerings drag along with it other players in the industry. If, after a while, AMD deems the problem sufficiently "solved", they can always spin out ZT on its own, again, and probably get at least most of what they paid.

Another thing to consider is that, when your stock price is (potentially) overvalued, it's a wise move to spend some of it on companies with solid revenue to help provide a higher floor, if/when a downturn occurs.

 

[shady28]

Vertical integration.

"Nobody's buying our AI stuff in data centers, so lets buy a system integrator and push it on the market that way."

This would be sort of like Intel buying Dell.

Not a fan.

 

[bit_user]

"Nobody's buying our AI stuff in data centers, so lets buy a system integrator and push it on the market that way."

Nvidia plays dirty. We all know that. They recently tried to force Microsoft to use Nvidia's nonstandard rack form factor, to make it harder for them to replace their machines with anything non-Nvidia, in the future.

https://www.tomshardware.com/tech-i...crosofts-b200-ai-gpus-in-its-own-server-rooms
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When you're up against a competitor like that, you have to think outside the box and beat a path to customers' doors, if need be.

Don't worry about Intel & Nvidia, though. I think there's no way AMD would lock them out of ZT Systems integrations. It would impact their revenues too severely.

This would be sort of like Intel buying Dell.

Actually, with Dell being such Intel stalwarts, it would be more like AMD buying Dell.