AMD aims to challenge Nvidia's AI dominance with $4.9 billion acquisition

AMD is making a bold move to compete with Nvidia in the AI market. The chipmaker is buying AI infrastructure company ZT Systems for $4.9 billion to boost adoption of its Instinct data center chips. ZT Systems builds custom computing infrastructure for major AI companies like Microsoft, Meta, and Amazon. The acquisition brings 1,000 engineers to AMD and will allow for simultaneous development of chips and systems. AMD CEO Lisa Su expects this move to significantly speed up deployment of AMD's AI solutions. AMD's data center revenue topped $1 billion for the first time last quarter, but still trails far behind Nvidia's $22.6 billion. The deal still needs regulatory approval. AMD plans to launch its MI350 chip in 2025 to compete with Nvidia's new Blackwell GPU. The company also recently acquired European AI startup Silo AI.