I speak so much about Nvidia. And for good motive…
Simply final month, the corporate posted a $44 billion quarter — one of many largest within the historical past of U.S. tech corporations.
Nvidia’s information heart enterprise alone made extra money than many Fortune 500 corporations.
The corporate is the market chief in cutting-edge AI know-how. And when Nvidia’s CEO Jensen Huang speaks, it typically leads to the information.
However this week, one in every of Nvidia’s greatest opponents was the one making headlines.
AMD’s CEO Lisa Su turned heads on the firm’s “Advancing AI” occasion when she mentioned she expects the marketplace for AI compute infrastructure to soar previous $500 billion within the subsequent three years.
Supply: Wikimedia Commons
However she didn’t cease there.
Regardless of Nvidia being the 800-pound gorilla on this area, Su urged AMD has an actual shot at taking among the AI large’s market share.
Primarily based on what AMD showcased throughout the occasion, I consider she is likely to be proper…
AMD’s Menace to Nvidia’s AI Dominance
Su went on to disclose a brand new chip from AMD known as the MI355X that’s designed to go toe-to-toe with Nvidia’s industry-leading AI processors.
The MI355X is AMD’s most aggressive AI chip but.
Supply: AMD
It’s a dense, high-performance accelerator that’s constructed to deal with the sorts of huge workloads corporations like OpenAI, Meta and Microsoft demand.
AMD claims its new chip sequence is quicker than Nvidia’s counterparts and represents main features over earlier variations.
That alone is thrilling. However I’m much more intrigued by how AMD intends to compete on this area.
Fairly than mimicking Nvidia’s tightly built-in ecosystem, AMD is leaning into open requirements. It’s providing a extra modular, versatile method for corporations that need management over their stack.
To that finish, Su previewed AMD’s new “Helios” rack system, a full end-to-end AI platform constructed round this open infrastructure.
She known as it: “a recreation changer.”
These racks embrace every little thing a supercomputer wants, together with its brains (CPUs), muscle tissues (GPUs) and quick web connections (NICs), all working collectively.
It’s an answer aimed toward each frontier mannequin coaching and large-scale AI inference. And it brought on my Spidey-sense to set off.
As a result of in relation to AI coaching, one firm prefers to play by its personal guidelines.
In fact, I’m speaking about Tesla.
On Might 20, Elon Musk instructed CNBC that Tesla and xAI would proceed shopping for quite a lot of GPUs from Nvidia, but additionally “some from AMD” and probably others.
I don’t suppose it’s loopy to learn extra into that assertion.
You see, Tesla is at the moment constructing out huge compute clusters to assist its Dojo supercomputer and energy its Optimus humanoid robotic.
The size of this effort is big. And it requires {hardware} that’s quick, reasonably priced and versatile.
Nvidia provides best-in-class efficiency, no query. But it surely comes bundled in what some engineers name a “black field.” In different phrases, it’s a closed system the place Nvidia controls practically each layer, from the chip to the software program stack to the networking gear.
For a corporation like Tesla — which has a protracted historical past of constructing in-house and optimizing from the bottom up — that sort of vendor lock-in may not be supreme.
That’s why AMD’s open method is sensible to me right here.
It might let Tesla customise its AI infrastructure with out being tied to 1 proprietary ecosystem.
It may additionally decrease prices at a time when GPU provide remains to be constrained and costs stay sky-high.
If the MI355X delivers even near Nvidia’s efficiency, Musk could have each motive to start out shifting to AMD’s merchandise.
That’s very true for Optimus, which Musk mentioned could possibly be “value greater than [Tesla’s] automobile enterprise and price greater than full self-driving.”
Supply: Wikimedia Commons
It’s additionally value noting that Tesla has made a behavior of quietly adopting AMD chips for in-vehicle purposes over the previous few years.
So this wouldn’t be the primary time Musk gave Su’s workforce a shot.
Right here’s My Take
AMD’s inventory has fallen nicely under final yr’s highs.
Supply: Yahoo Finance
However that might quickly change.
I don’t consider Tesla will abandon Nvidia in a single day.
However AMD simply made its most convincing pitch but, with a robust product and a method that provides corporations like Tesla extra management.
I consider it’s solely a matter of time earlier than we may see Elon announce a serious AI deployment constructed on AMD {hardware}.
And the 800-pound gorilla is likely to be in for a critical struggle.
Regards,
Ian King
Chief Strategist, Banyan Hill Publishing
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