Yahoo Finance AMD to Buy European AI Lab Silo in Race Against Nvidia
(Bloomberg) -- Advanced Micro Devices Inc. has agreed to buy Silo AI for $665 million in cash, adding a maker of artificial intelligence models that will help its push to close the gap on Nvidia Corp.
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The US chipmaker is acquiring the Helsinki-based company, which describes itself as Europe’s largest private AI lab and has customers that include Allianz SE, Unilever Plc and Bayerische Motoren Werke AG unit Rolls-Royce, it said in a statement on Wednesday. Co-founder and Chief Executive Officer Peter Sarlin will continue to lead his team, which will become part of AMD’s Artificial Intelligence Group.
Santa Clara, California-based AMD is seen as Nvidia’s closest potential competitor in the fast-growing market for hardware used to develop new software and services powered by AI. Graphics chips, which the two companies specialize in, have proven the most efficient means to train the large language models that underpin user-facing services like OpenAI’s ChatGPT and Microsoft Corp.’s Copilot.
“Silo AI’s team of trusted AI experts and proven experience developing leadership AI models and solutions, including state-of-the-art LLMs built on AMD platforms, will further accelerate our AI strategy and advance the build-out and rapid implementation of AI solutions for our global customers,” said AMD Senior Vice President Vamsi Boppana.
Shares of AMD rose 1.4% at 9:43 a.m. in New York.
AMD’s still a relative newcomer to the AI development field, and it’s racing to add hardware and software to its lineup. The company is eyeing an opportunity that fueled a sales boom at Nvidia and helped turn it into the world’s most valuable chipmaker.
Under CEO Lisa Su, AMD has introduced a line of MI300 accelerators and promised that the products will generate about $4 billion in revenue this year. That’s much more than the projections of other accelerator contenders, such as Intel Corp. But Nvidia itself is expected to generate more than $100 billion this year from its data center chip business alone.
Silo AI specializes in creating AI models and systems that are tailored to the specific needs of individual companies. The acquisition comes on top of $125 million in investments that AMD has made in the last 12 months increasing its suite of offerings that make it easier to use AMD chip-based systems.
AMD’s stock has gained about 20% in 2024, trailing the 38% advance by the Philadelphia Stock Exchange Semiconductor Index and the 165% gain by Nvidia. Even with that modest relative gain, AMD’s market capital of $286 billion is close to an all-time high for the company.
(Adds share price in the fifth paragraph.)
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