Skip to content

Microsoft Teams Up With AMD To Dethrone Nvidia From AI Chip Throne

One of 2023’s best-performing stocks, Nvidia, slipped moments after Bloomberg reported that Microsoft is working with AMD on the chipmaker’s expansion into artificial intelligence processors, part of a multifaceted strategy to securing more highly coveted components and preventing Nvidia from becoming the sole chip supplier in the industry.

The companies are teaming up to offer an alternative to Nvidia, which dominates the market for artificial intelligence chips called graphics processing units. And since MSFT is not (yet) engaged in manufacturing, the software giant will provide financial support to bolster AMD’s efforts and is also working with the chipmaker on a local Microsoft processor for AI workloads, codenamed Athena.

AMD shares rose more than 6.5% on Thursday and Microsoft gained 1%. Representatives for both companies declined to comment. Nvidia shares fell as much as 1.9% before paring much of the losses

The alliance is part of a broader push to increase AI processing power, which is in high demand following the explosion of chatbots like ChatGPT and other services based on the technology. Microsoft is both a leading provider of cloud computing services and a driving force behind the use of AI. The company has pumped $10 billion into ChatGPT maker OpenAI and is committed to adding these features to its entire software lineup.

According to Bloomberg, the move also reflects Microsoft’s deepening involvement in the chip industry. The company has been building a silicon division in recent years under former Intel Corp. Rani Borkar, and the group now has a workforce of nearly 1,000 employees. Information last month reported on Microsoft’s development of the Athena artificial intelligence chip.

Several hundred of these employees are working on the Athena project, and Microsoft has spent about $2 billion on its chip efforts. But the company does not foretell a split with Nvidia. Microsoft intends to continue working closely with this company, whose chips are the workhorses for training and running AI systems. It is also trying to find ways to get more processors from Nvidia, underscoring the pressing shortages facing Microsoft and others.

Microsoft’s relationship with OpenAI, and its own list of newly introduced AI services, require computing power at a level beyond what the company expected when it ordered chips and set up data centers. OpenAI’s ChatGPT service has attracted interest from companies looking to use it as part of their own products or corporate applications, and Microsoft has introduced a chat-based version of Bing and new AI-enhanced Office tools .

It’s also updating older products like GitHub’s code generation tool. All of these AI programs run on Microsoft’s Azure cloud and require the expensive and powerful processors provided by Nvidia.

Borkar’s team at Microsoft, which has also worked on chips for servers and Surface PCs, is now prioritizing Project Athena. He is developing a graphics processing unit that can be used to train and run AI models. The product is already being tested internally and could be more widely available as early as next year, one of the people said.

While the project does make that timeline, an early version is just a starting point, the people said. It takes years to build a good chip, and Nvidia has a substantial advantage. Nvidia is the chip supplier of choice for many vendors of generative AI tools, including Inc.’s AWS. and Google’s cloud, and Elon Musk has reportedly secured thousands of its processors for his fledgling AI business.

Creating an alternative to Nvidia’s line will be a difficult task. This company offers a package of software and hardware that work together, including chips, a programming language, networking equipment and servers, which allows customers to quickly upgrade their capabilities.

Source link

Leave a Reply

Your email address will not be published. Required fields are marked *