AMD, the chipmaker competing with Nvidia in the AI race, has made a significant acquisition to strengthen its position as an “ecosystem” partner for companies in the AI industry. The company has acquired ZT Systems, a provider of compute design and infrastructure for AI, cloud, and general-purpose computing, for $4.9 billion. The deal includes a mix of cash and stock, with a potential additional payment of up to $400 million based on performance metrics.
ZT Systems, based in New Jersey, has been privately-held since its inception in 1994. It has worked closely with major chipmakers like Nvidia and Intel on various projects, including server solutions, storage, high-performance computing, 5G, and edge computing. The acquisition of ZT Systems will give AMD access to a wealth of expertise in AI systems design, encompassing not only silicon but also software and systems. This knowledge will enable AMD to sell more of its chips and systems to customers.
The acquisition comes at a crucial time as AI systems continue to evolve and become more complex. One of the main challenges for tech companies operating in this space is to improve the efficiency of their systems, particularly in compute-heavy tasks like AI model training and inferencing. By incorporating ZT Systems’ expertise, AMD aims to enhance its data center AI systems and customer enablement capabilities.
Dr. Lisa Su, AMD’s chair and CEO, stated that the acquisition of ZT Systems is a major step in the company’s long-term AI strategy. The addition of ZT Systems’ systems design and rack-scale solutions expertise will further strengthen AMD’s data center AI infrastructure. This, combined with AMD’s existing high-performance Instinct AI accelerator, EPYC CPU, and networking product portfolios, will allow the company to deliver end-to-end data center AI infrastructure at scale.
While ZT Systems does not disclose the names of its clients, it has gained recognition in recent years for its specialist support in AI computing architecture design. The company’s CEO, Frank Zhang, will lead AMD’s manufacturing business, and ZT Systems will become part of AMD’s Data Center Solutions Business Group.
Both companies are enthusiastic about the acquisition. Zhang expressed excitement about joining AMD and playing a larger role in designing the AI infrastructure that is shaping the future of computing. Doug Huang, ZT President, will lead the design and customer enablement teams, reporting to Forrest Norrod, AMD’s executive vice president and general manager.
The deal is expected to close in the first half of 2025, marking a significant milestone for AMD as it continues to expand its presence in the AI industry. With the acquisition of ZT Systems, AMD is poised to further strengthen its position as a leading player in the AI ecosystem, offering comprehensive solutions to its customers.
