Advanced Micro Devices Inc (AMD) has agreed to buy server maker ZT Systems Inc in a cash and stock transaction valued at US$4.9 billion, adding data center technology that would bolster its efforts to challenge Nvidia Corp.
ZT Systems, based in Secaucus, New Jersey, would become part of AMD’s Data Center Solutions Business Group, it said in a statement yesterday.
AMD would retain the business’ design and customer teams and look to sell the manufacturing division. The deal price includes a contingent payment of US$400 million based on certain milestones.
Photo: Bloomberg
AMD shares rose 2.5 percent in premarket trading yesterday after the news.
Closely held ZT has extensive experience making server computers for owners of large data centers — the kind of customers that are pouring billions of dollars into new artificial intelligence (AI) capabilities.
The acquisition would “significantly strengthen our data center AI systems,” AMD chief executive officer Lisa Su (蘇姿丰) said in the statement.
The company has its sights set on Nvidia, the runaway leader in the market for data center gear needed to support AI computing. AMD is adding software and hardware capabilities that would better match the breadth of Nvidia’s offerings and speed up the uptake of its chips.
AMD is the second-biggest provider of the graphics processors that have become so vital to developing AI software. The company has spent more than US$1 billion in the past 12 months to expand its reach in that market.
Last month, the company agreed to buy Silo AI for US$665 million to add a maker of artificial intelligence models.
Santa Clara, California-based AMD is seen as Nvidia’s closest rival in AI processors.
Its new MI range of accelerator chips would bring in more than US$4.5 billion of new revenue this year, the company has projected.
That puts it ahead of all other challengers to Nvidia, but still way behind. Analysts expect Nvidia to generate US$100 billion in data center revenue this fiscal year.
Part of Nvidia’s expansion has been fueled by offering chips, networking, servers, software and services, all aimed at making AI use more pervasive in the economy. Under Su’s leadership, AMD is showing a commitment to match that reach.
AMD shares rose less than 1 percent in New York trading on Friday, leaving the stock little changed this year, but gains over recent years have pushed its market value to US$240 billion, more than twice that of longtime rival Intel Corp.
WEAKER ACTIVITY: The sharpest deterioration was seen in the electronics and optical components sector, with the production index falling 13.2 points to 44.5 Taiwan’s manufacturing sector last month contracted for a second consecutive month, with the purchasing managers’ index (PMI) slipping to 48, reflecting ongoing caution over trade uncertainties, the Chung-Hua Institution for Economic Research (CIER, 中華經濟研究院) said yesterday. The decline reflects growing caution among companies amid uncertainty surrounding US tariffs, semiconductor duties and automotive import levies, and it is also likely linked to fading front-loading activity, CIER president Lien Hsien-ming (連賢明) said. “Some clients have started shifting orders to Southeast Asian countries where tariff regimes are already clear,” Lien told a news conference. Firms across the supply chain are also lowering stock levels to mitigate
Six Taiwanese companies, including contract chipmaker Taiwan Semiconductor Manufacturing Co (TSMC, 台積電), made the 2025 Fortune Global 500 list of the world’s largest firms by revenue. In a report published by New York-based Fortune magazine on Tuesday, Hon Hai Precision Industry Co (鴻海精密), also known as Foxconn Technology Group (富士康科技集團), ranked highest among Taiwanese firms, placing 28th with revenue of US$213.69 billion. Up 60 spots from last year, TSMC rose to No. 126 with US$90.16 billion in revenue, followed by Quanta Computer Inc (廣達) at 348th, Pegatron Corp (和碩) at 461st, CPC Corp, Taiwan (台灣中油) at 494th and Wistron Corp (緯創) at
NEGOTIATIONS: Semiconductors play an outsized role in Taiwan’s industrial and economic development and are a major driver of the Taiwan-US trade imbalance With US President Donald Trump threatening to impose tariffs on semiconductors, Taiwan is expected to face a significant challenge, as information and communications technology (ICT) products account for more than 70 percent of its exports to the US, Chung-Hua Institution for Economic Research (CIER, 中華經濟研究院) president Lien Hsien-ming (連賢明) said on Friday. Compared with other countries, semiconductors play a disproportionately large role in Taiwan’s industrial and economic development, Lien said. As the sixth-largest contributor to the US trade deficit, Taiwan recorded a US$73.9 billion trade surplus with the US last year — up from US$47.8 billion in 2023 — driven by strong
ASE Technology Holding Co (ASE, 日月光投控), the world’s biggest chip assembly and testing service provider, yesterday said it would boost equipment capital expenditure by up to 16 percent for this year to cope with strong customer demand for artificial intelligence (AI) applications. Aside from AI, a growing demand for semiconductors used in the automotive and industrial sectors is to drive ASE’s capacity next year, the Kaohsiung-based company said. “We do see the disparity between AI and other general sectors, and that pretty much aligns the scenario in the first half of this year,” ASE chief operating officer Tien Wu (吳田玉) told an
RSS