AMD Sells ZT Systems Manufacturing to Sanmina for $3 Billion

Advanced Micro Devices, Inc. (AMD) has announced its decision to sell the data center infrastructure manufacturing business of ZT Systems to Sanmina Corporation for a sum of $3 billion. This transaction is expected to be finalized by the end of the year. The agreement was reached on May 19th, local time, and marks a significant move in AMD's strategic restructuring following its acquisition of ZT Systems in August of the previous year.

In August 2024, AMD acquired ZT Systems, a server manufacturer, for $4.9 billion in a deal that included both cash and stock. At the time of the acquisition, AMD had stated its intention to retain ZT Systems' design and customer teams while divesting its manufacturing division. The sale to Sanmina aligns with this strategy, allowing AMD to focus on its core competencies while leveraging Sanmina's expertise in integrated manufacturing solutions.

Sanmina, known for its comprehensive manufacturing services, will acquire the manufacturing assets of ZT Systems. This acquisition is expected to enhance Sanmina's capabilities in the data center infrastructure sector, providing it with a stronger foothold in the market. The transaction underscores Sanmina's commitment to expanding its service offerings and strengthening its position as a leading provider of integrated manufacturing solutions.

For AMD, the sale represents a strategic move to streamline its operations and focus on high-growth areas. By divesting the manufacturing business, AMD can allocate more resources to research and development, innovation, and expanding its product portfolio. This decision is part of AMD's broader strategy to enhance its competitive edge in the rapidly evolving technology landscape.

The transaction is subject to customary closing conditions and regulatory approvals. Both companies have expressed confidence in the successful completion of the deal by the end of the year. The sale of ZT Systems' manufacturing business to Sanmina is expected to have a positive impact on both companies, enabling them to leverage their respective strengths and achieve their strategic goals.