• AMD is set to announce new AI processors, intensifying competition in the AI chip market.
• The MI350 series chip is designed to challenge Nvidia's dominance in the market.
• AMD's AI chip forecast was raised to $4.5 billion due to high demand for the MI300X chips.
• Despite AMD's aggressive moves, analysts believe Nvidia's data center revenue will remain unaffected due to high demand.

In a significant move that underscores the escalating competition in the artificial intelligence (AI) chip market, Advanced Micro Devices (AMD) is poised to announce several new AI processors and other chips at a data center event in San Francisco.

The announcement is expected to further solidify AMD's position as a growing supplier of AI chips in a market that has been largely dominated by Nvidia. The San Francisco event on Thursday, is anticipated to be a platform for AMD to detail its MI325X chip and the next-generation MI350 chip.

These chips were initially unveiled at the Computex trade show in Taiwan in June, with promises of their release slated for this year and the next, respectively. The MI350 series, in particular, is designed to compete with Nvidia's Blackwell architecture, offering increased computing horsepower and memory. This is a strategic move by AMD to challenge Nvidia's dominance in the AI chip market.

In addition to the AI chips, AMD is also expected to announce new server central processing units (CPUs) and PC chips that feature more AI computing horsepower. This is a clear indication of AMD's commitment to advancing AI technology and meeting the growing demand for AI-powered solutions.

AMD's AI Chip Business and Market Forecast

The current MI300X AI chip, which was launched late last year, has seen a rapid increase in production to meet the surging demand. In July, AMD raised its AI chip forecast to $4.5 billion for the year, up from its previous target of $4 billion. This adjustment reflects the high demand for the MI300X chips, particularly in the context of generative AI product development.

Despite AMD's aggressive moves, analysts believe that the company's launch is unlikely to impact Nvidia's data center revenue as the demand for such chips vastly exceeds the availability. This year, AMD is expected to report data center revenue of $12.83 billion, according to LSEG estimates. In contrast, Wall Street expects Nvidia to report data center revenue of $110.36 billion. Data center revenue is a key indicator of the demand for AI chips needed to build and run AI applications.

The AI Chip Market: A Competitive Landscape

The AI chip market has seen significant developments in recent years. For instance, Intel, another major player in the chip market, revealed its next-gen AI data center chips, the Gaudi 3 accelerator kit. This kit, which houses eight Xeon 6 chips, is priced at around $125,000, making it considerably cheaper than Nvidia's comparable HGX server system.

Nvidia, on the other hand, has been making strides in the AI market. The company unveiled its next-generation AI platform, the Rubin platform, which is set to be released in 2026. This platform will succeed the Blackwell, which was unveiled in March and is expected to be sold out into 2025 amid soaring AI demand.

The competition between Intel and AMD in the data center market has been heating up again. AMD's CEO, Lisa Su, has made it clear that the company is not aiming to be a niche player or a second-source. This statement reflects AMD's ambition to be a major player in the AI chip market.