AMD to cut 4% of workforce to prioritize AI chip expansion and rival Nvidia

However, on a deeper look, the Q3 results showed both strengths and challenges: while total revenue rose by 18% to $6.8 billion, gaming chip revenue plummeted 69% year-over-year, and embedded chip sales dropped 25%.

In its recent earnings call, AMD CEO Lisa Su underscored that the data center and AI business is now pivotal to the company’s future, expecting a 98% growth in this segment for 2024.

Su attributed the recent revenue gains to orders from clients like Microsoft and Meta, with the latter now adopting AMD’s MI300X GPUs for internal workloads.

However, unlike AMD’s relatively targeted job reductions, Intel recently implemented far larger cuts, eliminating approximately 15,000 positions amid its restructuring efforts.

Data center and AI drive growth

AMD has been growing rapidly through initiatives such as optimizing Instinct GPUs for AI workloads and meeting data center reliability standards, which led to a $500 million increase in the company’s 2024 Instinct sales forecast.

Major clients like Microsoft and Meta too expanded their use of MI300X GPUs, with Microsoft using them for Copilot services and Meta deploying them for Llama models. Public cloud providers, including Microsoft and Oracle Cloud, along with several AI startups, also adopted MI300X instances.