AMD says new chips top Nvidia’s in booming AI chip field

By Ian King, Bloomberg

Advanced Micro Devices Inc. Chief Executive Officer Lisa Su said her company’s latest AI processors can challenge Nvidia Corp. chips in a market she now expects to soar past $500 billion in the next three years.

The new installments in AMD’s MI350 chip series are faster than Nvidia counterparts and represent major gains over earlier versions, Su said at a company event Thursday in San Jose, California. The MI355 chips, which started shipping earlier this month, are 35 times faster than predecessors, she said.

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Though AMD remains a distant second to Nvidia in AI accelerators — the chips that help develop and run artificial intelligence tools — it aims to start catching up with these new products. The stakes are higher than ever: Su previously predicted $500 billion in market revenue by 2028, but she now sees it topping that number.

“People used to think that $500 billion was very large number,” she said in a briefing following her presentation. “Now it seems well within grasp.”

In February, AMD gave a forecast for its data center business that reflected slower growth than some analysts predicted. AMD believes the new update to its MI range will restore momentum and prove it can go toe to toe with a much bigger rival.

AMD said that the MI355 outperforms Nvidia’s B200 and GB200 products when it comes to running AI software and equals or exceeds them when creating the code. Purchasers will pay significantly less than they would versus Nvidia, AMD said.

A representative for Nvidia didn’t have an immediate comment.

Investors gave a tepid response to AMD’s latest presentation, with the shares falling 2.2% to $118.50 at the close Thursday in New York. That wiped out the small gains that the stock made this year.

Nvidia and AMD are the leading providers of advanced computer graphics chips, which became the basis of components for developing AI. Demand has consistently outstripped supply as some of the world’s largest companies have poured tens of billions of dollars into new infrastructure. That’s forced up the price of chips, which can cost multiple tens of thousands of dollars each.

For AMD, the accelerator business has helped it escape the shadow of Intel Corp., its longtime rival in personal computer processors. But Nvidia has eclipsed them both. While AMD is getting multiple billions of dollars from its AI accelerators, Nvidia is generating more than $100 billion a year.

Su also previewed what’s coming next, including the follow-up MI400 series that will hit the market next year. She said the product will achieve clear leadership over the Nvidia chips available at that time. AMD is adding more memory and components that can access information more quickly, an important advantage when running AI software, Su said.

OpenAI CEO Sam Altman made an appearance on stage with Su, who explained that the MI400 was designed with input from the AI company’s engineers.

Altman said that when he’d initially been told about the MI400’s proposed specifications, he thought to himself, “No way.” He said that the demands on computing infrastructure have accelerated this year as the use of AI services has graduated from an amusing curiosity to one with value to businesses.

A key question is whether AMD will be able to sell its AI chips more widely. Like Nvidia, the company is restricted from shipping its most powerful components to China under US trade curbs. AMD is lobbying hard to try to get the Trump administration to allow them to freely offer AI components to other countries.

A recent deal announced in Saudi Arabia was signed after consulting Washington to make sure that AMD would be allowed to supply the chips, Su said on Thursday. More freedom is needed to make sure that US technology remains central to the development of AI systems worldwide, she said.

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