By Max A. Cherney
SAN FRANCISCO (Reuters) -Advanced Micro Devices said it planned to start mass production of a new version of its artificial-intelligence chip called the MI325X in the fourth quarter of the year, as it seeks to beef up its AI chips in a market dominated by Nvidia (NASDAQ:NVDA).
The announcements made on Thursday at an AMD (NASDAQ:AMD) event in San Francisco come as demand for AI processors from major technology firms, including Microsoft (NASDAQ:MSFT) and Meta Platforms (NASDAQ:META), far exceeds their availability.
Santa Clara, California-based AMD said vendors such as Super Micro Computer (NASDAQ:SMCI) would begin to ship its new AI chip to customers in the first quarter of 2025. The AMD design aims to compete with Nvidia’s Blackwell architecture.
AMD shares fell 2.5% during the event. Rival Nvidia was trading 1.2% higher while Intel (NASDAQ:INTC) was down 0.7%.
Shares of AMD are up about 30% since a recent low in early August.
The MI325X chip uses the same architecture as the already-available MI300X, which AMD launched last year. The new chip includes a new type of memory that AMD said will speed AI calculations.
In the second half of 2025, AMD plans to make its next-generation MI350 series chips available. The MI350 chips include an increased amount of memory and will also boast a new underlying architecture that AMD said will improve performance significantly over the prior MI300X and MI250X.
The company also announced the availability of a new version of its server central processing unit (CPU) design. The family of chips formerly codenamed Turin includes a version of one of them that is designed to keep the graphics processing units (GPUs) fed with data – which will speed AI processing.
The flagship chip boasts nearly 200 processing cores and is priced at $14,813. The whole line of processors uses the Zen 5 architecture that offers speed gains of as much as 37% for advanced AI data crunching.
AMD’s launch on Thursday is unlikely to impact Nvidia’s data center revenue due to the mounting demand for such chips.
In July, AMD raised its AI chip forecast to $4.5 billion for the year from its previous target of $4 billion. Demand for its MI300X chips has surged because of the frenzy around building and deploying generative AI products.
This year analysts expect AMD to report data center revenue of $12.83 billion, according to LSEG estimates. Wall Street expects Nvidia to report data center revenue of $110.36 billion. Data center revenue is a proxy for AI chips needed to build and run AI applications.
