AMD can leverage these insights to refine and customize chip designs to meet specific needs and requirements.
“By integrating ZT Systems’ expertise, AMD aims to accelerate its development of AI-optimized chips and potentially gain a competitive edge in influencing customer decisions,” Ram said. “While ZT Systems has historically worked with other chipmakers, the acquisition introduces strong incentives to prioritize AMD solutions, potentially expanding AMD’s market share in AI servers.”
Notably, the largest demand for Nvidia’s systems during the past two years of the generative AI revolution has come from hyperscalers, said Neil Shah, VP of research and partner at Counterpoint Research. ZT Systems effectively meets the specific design and integration requirements of these companies.
“ZT Systems has been a key partner for Nvidia in custom designing and integrating advanced Nvidia server racks and clusters for hyper scalers,” Shah said. “This expertise in custom server design, driving tighter integration across all components from compute, accelerators, and storage to networking, makes ZT Systems a unique solution provider and a significant factor in Nvidia’s success.”
Avoiding direct competition in manufacturing
Notably, AMD plans to sell the manufacturing division of ZT Systems after the acquisition. Sharath Srinivasamurthy, associate vice president at IDC, pointed out that this means the main reason for this acquisition seems to be the design capabilities that ZT will bring in.
“For manufacturing, AMD’s strategy seems to be to leverage the proven ecosystem that has worked well for them,” Srinivasamurthy said.
