AMD Unveils MI355 Chip to Rival Nvidia in $500 Billion AI Race

AMD CEO Lisa Su has announced the company's new AI processor, the MI355 chip, which is challenging Nvidia's B200 and GB200 chips. Su confidently stated that the AI processing market could exceed $500 billion within the next three years, underlining the significance of this competition.

At an event in San Jose, California, Su emphasized the advancements of the MI350 series, noting its speed superiority over competing Nvidia products. The MI355, set for release this month, reportedly demonstrates a 35-fold performance increase over previous iterations.

Although AMD trails Nvidia in the AI accelerators market, which is crucial for the development and deployment of AI tools, the company is committed to narrowing this gap. Su previously suggested that reaching a $500 billion market value by 2028 seemed daunting, but now sees it as achievable.

Despite a tempered initial reception from investors, as reflected by a 2.2% drop in AMD's share price following the announcement, the company maintains optimism. It highlights that the MI355 offers superior performance in AI software execution compared to Nvidia's chips, at a more competitive price point.

The rivalry between Nvidia and AMD is a pivotal narrative, as their products are essential to AI development, amid massive infrastructure investments from tech giants. As demand continues outstripping supply, individual chip prices have surged into tens of thousands of dollars.

Su also previewed the forthcoming MI400 series, expected to surpass Nvidia's equivalent offerings in 2024, reinforcing AMD's ambition in the AI sector. This new series will include enhanced memory and high-speed data reading components vital for AI software operations.

The critical challenge remains in expanding AI chip sales, particularly under U.S. trade restrictions that prevent AMD and Nvidia from selling their highest-performance components to China. Su expressed intentions to advocate for relaxed export regulations to other countries.

Additionally, collaboration with OpenAI has influenced the MI400's development, integrating suggestions from their engineers. OpenAI CEO Sam Altman acknowledged the transformative growth in AI services and the escalating demand for advanced computing infrastructure.

AMD's strategic maneuvers, including efforts in AI accelerators, seek to alleviate the longstanding dominance of Intel in PC processors, albeit Nvidia currently stands as a greater competitor. This pursuit also involves navigation through regulatory landscapes to maintain AMD's global market presence.