I speak so much about Nvidia. And for good purpose…
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 knowledge heart enterprise alone made more cash 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 usually results in the information.
However this week, one in every of Nvidia’s greatest rivals was the one making headlines.
AMD’s CEO Lisa Su turned heads on the firm’s “Advancing AI” occasion when she stated 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 house, Su recommended AMD has an actual shot at taking a few of the AI large’s market share.
Primarily based on what AMD showcased throughout the occasion, I consider she may be proper…
AMD’s Risk 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 large workloads corporations like OpenAI, Meta and Microsoft demand.
AMD claims its new chip collection is quicker than Nvidia’s counterparts and represents main good points over earlier variations.
That alone is thrilling. However I’m much more intrigued by how AMD intends to compete on this house.
Fairly than mimicking Nvidia’s tightly built-in ecosystem, AMD is leaning into open requirements. It’s providing a extra modular, versatile strategy 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 the whole lot a supercomputer wants, together with its brains (CPUs), muscle mass (GPUs) and quick web connections (NICs), all working collectively.
It’s an answer geared toward each frontier mannequin coaching and large-scale AI inference. And it triggered my Spidey-sense to set off.
As a result of in relation to AI coaching, one firm prefers to play by its personal guidelines.
After all, I’m speaking about Tesla.
On Might 20, Elon Musk informed 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 large compute clusters to help 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 presents best-in-class efficiency, no query. Nevertheless it comes bundled in what some engineers name a “black field.” In different phrases, it’s a closed system the place Nvidia controls almost 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 type of vendor lock-in may not be superb.
That’s why AMD’s open strategy is smart to me right here.
It could let Tesla customise its AI infrastructure with out being tied to at least one proprietary ecosystem.
It might additionally decrease prices at a time when GPU provide continues to be constrained and costs stay sky-high.
If the MI355X delivers even near Nvidia’s efficiency, Musk could have each purpose to begin shifting to AMD’s merchandise.
That’s very true for Optimus, which Musk stated might be “price greater than [Tesla’s] automobile enterprise and price greater than full self-driving.”
Supply: Wikimedia Commons
It’s additionally price noting that Tesla has made a behavior of quietly adopting AMD chips for in-vehicle functions 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 effectively under final yr’s highs.
Supply: Yahoo Finance
However that would 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 powerful product and a technique that provides corporations like Tesla extra management.
I consider it’s solely a matter of time earlier than we might see Elon announce a significant AI deployment constructed on AMD {hardware}.
And the 800-pound gorilla may be in for a severe combat.
Regards,
Ian King
Chief Strategist, Banyan Hill Publishing
Editor’s Be aware: We’d love to listen to from you!
If you wish to share your ideas or solutions concerning the Each day Disruptor, or if there are any particular subjects you’d like us to cowl, simply ship an e-mail to dailydisruptor@banyanhill.com.
Don’t fear, we gained’t reveal your full identify within the occasion we publish a response. So be happy to remark away!
