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Advanced Micro Zooms on Intel Deal: Semi-Custom Shines

This deal, interestingly, comes six months after rampant speculation, begun by Bloomberg at the time, and advanced further by Web site Fudzilla in May, that Intel was going to strike a licensing deal with AMD for graphics technology as a move away from its longstanding license from competitor Nvidia (NVDA). Intel in May threw cold water on that speculation.

But Nvidia has increasingly become Intel’s rival for the data center. Perhaps arming AMD, the smaller GPU rival, is a good way to throw some trouble Nvidia’s way.

The announcement confirms what AMD CEO Lisa Su had told me back in July, which is that there would be “one additional design that will ramp in the second half of 2018” for the company’s “semi-custom” chip business, which has mainly been known for making parts for Microsoft’s (MSFT) Xbox and Sony’s (SNE) Playstations console.

As I wrote in a Barron’s print magazine article over the weekend, “[AMD’s] custom-chip business […] has all sorts of potential opportunities for years to come as custom silicon grows more prevalent."

Intel explained in its own statement, the chip giant said it wanted to push “performance” PCs into the real of “thin and light” laptops measuring 16 millimeters in thickness or less. Intel is combining its “Core-H” microprocessors with the “semi-custom” “Radeon” graphics processor from AMD, and something called “high-bandwidth memory,” or HBM2, as three chips working together inside a single “processor package."

The deal is interesting given Intel already has its own “embedded graphics” team, which puts GPU circuits into Intel processors. For “performance” PCs, Intel apparently decided such on-chip circuits weren’t enough.

Nvidia shares are up 61 cents at $209.30; it reports earning son Friday.


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