AMD (AMD) chair and CEO Dr. Lisa Su says her company is just getting started with the high-powered AI chip drops.
"We have accelerated our AI roadmap and are on a one-year cadence of new products," Su told Yahoo Finance at the Goldman Sachs Communacopia & Technology Conference on Monday. "It is an AI supercycle."
Later this year, AMD will show off its MI325 AI chip followed by the MI350 next year and the MI400 in 2026 — taking aim at rival Nvidia's (NVDA) dominance.
Added Su, "We believe we can have a very significant piece of the training and inference of these large language models."
The new MI chips teased by Su come hot on the heels of a successful debut of the MI300x release about a year ago. It can use up to 192GB of memory and boasts an astounding 153 billion transistors.
The beefy memory capabilities mean AMD's AI chip could be used to train large language models — such as OpenAI's ChatGPT — commonly known as "LLMs." This is a segment that has been dominated by Nvidia, but AMD is keen on carving out its own position in a rapidly growing marketplace.
Su tells us AMD may notch $4.5 billion in sales from this chip alone in 2024, up from about $100 million in AI-related chip revenue last year. The company's previous guidance for the MI300 was around $4 billion in sales this year.
It's the fastest-growing product in AMD's history, Su said.
"The MI300 guidance raise [in the second quarter] is a positive vs. falling expectations (including ours). AMD noted that supply/technical concerns are overstated and stated that they have not seen any cuts this year from their top customers (we believe Microsoft (MSFT), Meta (META) and Oracle (ORCL) are top 3). We assume the street will stay around $5 billion this year, which still supports the potential for $8-9 billion next year," Jefferies analyst Blayne Curtis said in a client note.
The momentum behind AI chips continues to power AMD's top and bottom lines.
Second quarter sales and earnings rose 9% and 19% year over year, respectively.
At the mid-point of its third quarter revenue outlook, AMD sees year-over-year growth of about 16% and sequential growth of approximately 15%.
"AI is a much larger cycle than I would have expected five years ago," Su said. "We are making big bets now for the next five years."
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