AMD has agreed to pay $4.9 billion to purchase ZT Methods, which designs and manufactures tools for synthetic intelligence (AI) and cloud computing information facilities. The deal is considered one of AMD’s greatest acquisitions and aligns with the chipmaker’s plans to cut back Nvidia’s dominant place in AI.
ZT Methods was based in New Jersey in 1994. It designs and manufactures servers, server racks, and different essential infrastructure for information facilities. ZT Methods is among the main suppliers of AI and general-purpose compute infrastructure for hyperscale suppliers.
In accordance to AMD chief government Lisa Su, ZT Methods has greater than $10 billion in annual gross sales. That’s virtually half of AMD’s $22.7 billion income in 2023. Su believes the acquisition will enhance upon “the investments [AMD has] made to speed up [its] AI {hardware} and software program roadmaps.”
As soon as the deal closes, ZT Methods CEO Frank Zhang will be part of AMD’s Information Middle Options Enterprise Group. Zhang will lead the manufacturing enterprise, whereas ZT president Doug Huang will head up the design and buyer enablement groups. Each will report to AMD government vice chairman and common supervisor Forrest Norris.
AMD gained’t hold the manufacturing aspect of ZT Methods, although. The plan is to promote the manufacturing functionality to “a strategic associate” and use ZT Methods to propel AMD’s capability to custom-design AI coaching clusters and information facilities. Su sees that as the primary worth ZT Methods can present to AMD.
Su known as the acquisition “the following main step in our long-term AI technique to ship management coaching and inferencing options that may be quickly deployed at scale throughout cloud and enterprise clients.”
That is the newest in a sequence of investments AMD has made to strengthen its AI capabilities. The corporate has elevated its natural analysis and improvement actions and invested greater than $1 billion to develop its AI ecosystem and enhance its AI software program capabilities.
The deal is predicted to shut by the primary half of 2025, assuming there aren’t any regulatory hurdles or closing situations to overcome. If all goes properly, the acquisition ought to enhance AMD’s income by the top of 2025.