Last week, AMD entered into agreement to acquire chip manufacturer Xilinx through a $35 billion all-stock transaction. This is the latest gargantuan M&A deal in the semiconductor market to focus on new opportunities in processing, after the NVIDIA-Arm announcement. The AMD-Xilinx partnership is meant to broaden AMD’s product portfolio, which focuses on high-performance CPUs and GPUs (graphics processing units). AMD CEO Lisa Su aims to establish the company as “the industry’s high-performance computing leader.” That would mean expanding AMD into a customer audience that Xilinx currently leads in high-performance field programmable gate array (FPGA) and system on a chip (SoC) components for data centers. These products target verticals that include communication, automotive, and defense markets. FPGAs can also serve AI infrastructure for machine learning (ML) inferencing.
Although the two companies differ in product and markets, the product lines will be complementary. AMD anticipates US$300 million in synergistic revenue. Short term, the companies will focus on combining go-to-market strategies. However, it’s likely they’ll start combining IP for their respective SoCs — such as Xilinx’s adaptable SoCs — to use more of AMD’s processor and GPU IP. Both companies face an enormous opportunity in AI. Expect a leadership position in high-performance computing (HPC) to also mean a massive stake in AI infrastructure. HPC is comprised of clusters of computational nodes conjoined with high volumes of storage and bandwidth to handle very complex scientific, engineering, and artificial intelligence workloads.
If you’re in the process of evaluating infrastructure options for your AI workloads or you’re interested in this topic in general, check out the following Forrester resources:
- Forrester wrote its “Now Tech: AI Infrastructure, Q1 2020” report to articulate the players in the chip, cloud, and services markets. VP and Principal Analyst Mike Gualtieri paired this research with his webinar “Buying AI Infrastructure: What You Need To Know.”
- In 2021, Mike, Principal Analyst Danny Mu, and I will collaborate on both a Now Tech and a Forrester Wave™ on AI infrastructure systems for both the North American and Chinese markets.
- Within the week, Mike and I will publish a report on HPC titled: “Fire Up Cloud-Based High-Performance Computing To Stoke Innovation.”
Will we see AMD dominate in HPC, or will it be NVIDIA? It’s too early to predict, but don’t count out Broadcom or processor king Intel. All are chasing the same Holy Grail, and we expect to see even more players joining the hunt. This is going to get interesting!
Schedule an inquiry with Mike Gualtieri, Danny Mu, or me by emailing email@example.com.