Wednesday, September 27, 2023

AMD’s AI Chip Debut and China Opportunity Fuel Optimistic Forecast for Year-end Performance

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  • AMD predicts strong year-end performance with the launch of its AI chips, potentially competing with Nvidia.
  • MI300 artificial intelligence chips, in high demand, are set to rival Nvidia’s advanced H100 chips.
  • AMD exploring opportunities in the Chinese market while adhering to export controls.
  • Data center sales, including MI300 chips, are expected to surpass the previous year’s figures.
  • AMD’s optimistic outlook amidst supply constraints and potential for AI-driven computing growth.


In a promising development for Advanced Micro Devices (AMD), the company foresees a strong finish to the year, attributing it to the upcoming launch of artificial intelligence chips that could rival Nvidia’s semiconductors. As a result, AMD’s shares witnessed a 3% surge in after-hours trading.

The CEO of AMD, Lisa Su, expressed confidence in the company’s plan to scale up production of its flagship MI300 artificial intelligence chips in the fourth quarter. These accelerator chips, already in high demand, are designed to compete with Nvidia’s advanced H100 chips.

According to Su, customer interest in the MI300 series chips is “very high,” with the company expanding its collaborations with top-tier cloud providers, large enterprises, and numerous leading AI firms during the third quarter.

Read Also: Intel Surges as Quarterly Report Points to Turnaround Amidst PC Market Slump

The market has been eagerly anticipating AMD’s MI300 chips, set for release later this year, with expectations that they will pose a formidable challenge to Nvidia’s dominance in the burgeoning AI chip sector.

However, AMD’s MI300 chips exceed the performance limits for sale to China under existing export controls. Unlike Nvidia and Intel, AMD has not yet developed special chips tailored to the lucrative Chinese market.

Su stated during a conference call with analysts that AMD is considering a strategy similar to Nvidia’s, modifying its chips to comply with U.S. export controls while catering to the Chinese market. She emphasized that AMD aims to be fully compliant with these regulations.

Although AMD has not provided a detailed full-year forecast, it expects data center sales, which include MI300 chips, to surpass the $6.04 billion recorded in 2022.

Analysts and investors are closely monitoring AMD’s progress, with many believing that the MI300 chips could fill the supply-demand gap left by Nvidia’s supply constraints. With enough components for an aggressive launch in the fourth quarter, AMD is poised to capitalize on this opportunity.

Su highlighted that there is also “strong interest” in AMD’s older MI250 chip, which remains a viable option for less complex AI tasks.

Notwithstanding the decline in PC shipments, the demand for data centers is expected to increase in the second half of the year, especially for AI chips and infrastructure. Analysts predict a double-digit percentage growth sequentially for AMD’s Data Center and Client segment revenues in the third quarter, driven by the rising demand for its EPYC and Ryzen processors.

As AMD continues to navigate through market dynamics and supply constraints, the company remains optimistic about its future. With its AI chip debut and potential China opportunity, AMD’s outlook is geared towards maintaining a strong presence in the semiconductor industry.

The company’s forecast for the current quarter anticipates revenue of approximately $5.7 billion, with analysts expecting around $5.82 billion in revenue.

In conclusion, AMD’s strategic advancements in AI chip technology and its plans to address market opportunities in China have positioned the company for a positive year-end performance. As the competition in the semiconductor industry intensifies, AMD’s successful debut of the MI300 chips could be a game-changer, propelling the company to new heights in the world of AI-driven computing.

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Ethan Rivers
Ethan Rivers
Hi there! I'm Ethan Rivers, a financial enthusiast and the proud author behind the popular financial blog, "Roms Deals." With a passion for helping others achieve financial freedom, I've spent years diving deep into the intricacies of personal finance, investment strategies, and wealth management. Through my blog, I aim to demystify the world of finance and provide practical tips that anyone can apply to their financial journey. Having worked in the financial industry for over a decade, I've gained valuable insights and experience that I love sharing with my readers. From navigating the stock market to maximizing savings, I strive to equip individuals with the knowledge and tools they need to make informed financial decisions. Join me on this exciting journey towards financial empowerment and let's unlock the doors to a brighter financial future together. Welcome to "Roms Deals"!

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