To better compete with Nvidia in the AI technology market for data centers, AMD is focusing on designing entire systems, not just chips. They announced plans to acquire ZT Systems for $4.9 billion in the first half of next year. ZT is known for designing and manufacturing AI and cloud computing systems for large data centers.
AMD CEO Lisa Su emphasized the need for chip providers to also assist in designing systems and accelerating production. ZT will support AMD’s largest customers in designing AI infrastructure while continuing to develop systems for organizations using competitors’ technology.
The acquisition of ZT not only strengthens AMD’s position in the AI accelerator market but also allows them to compete against Intel in large organization data centers. AMD is strategically launching new products like the MI300 Series and developing open software stacks to optimize their offerings for AI workloads.
After the deal is finalized, AMD plans to sell ZT’s hardware manufacturing unit and retain approximately a thousand of the company’s 2,500 employees. ZT’s revenue was primarily generated through its manufacturing unit, contributing to approximately $10 billion in the last 12 months.
ZT will become part of AMD’s data center business group, with ZT CEO Frank Zhang leading AMD’s manufacturing business and ZT President Doug Huang overseeing system design teams. This acquisition comes shortly after AMD’s purchase of Silo AI, an European lab specializing in AI services for various industries.
Overall, the acquisition of ZT is one of AMD’s largest and is expected to significantly impact their position in the AI technology market for data centers.