2025-03-31 12:31:00
www.pcgamer.com
It won’t have escaped your notice that in recent years, Nvidia has been transitioning away from being ‘just’ a chip designer into a fully-fledged systems integration company. If you want a massive data centre or a host of AI servers, Nvidia will design and build the whole thing for you. And now it seems AMD is getting in on the action having finalised a near-five billion dollar deal for ZT Systems, a company that designs and makes—yes, you’ve guessed it—data, cloud, and AI centres.
AMD announced its closing of the purchase deal today (via GlobalWire), having first made its intentions publicly known in August of last year. The acquisition, worth $4.9 billion in cash and stocks, will certainly make a bit of a dent in AMD’s financials, but there’s no doubt that it’ll be worth every cent if the AI market continues to grow as expected.
In FY 2024, AMD pulled in revenues of $12.6 billion with its data centre division, accounting for almost 50% of its entire revenue that year. It’s also AMD’s second most profitable sector, with an operating margin of roughly 27%—more than double that of its Client and Gaming sectors.
Nvidia’s data centre division is a veritable money-making machine, pulling in nearly $50 billion in revenue last year, so it’s not hard to see why AMD set about snapping up ZT Systems. The last mega purchase it made was Xilinx for $35 billion, to bolster its embedded sector, so this one is chump change in comparison.
Whether this acquisition pays out, though, is another question altogether, as Nvidia currently dominates the AI server market. Up to now AMD’s only had the hardware on offer, in the form of its gargantuan and very popular Instinct MI300 chips, but now it will be able to provide entire systems and installations.
Anyone who has worked in system building, be it gaming desktop PCs or massive servers, will know that this is where the real profit margins lie (it’s why Nvidia’s profit margins are so big).
More importantly, customers like Apple, Facebook, and the usual AI crowd will be more willing to splash the cash on a complete service rather than having to fiddle about with the hardware themselves.
That said, while the purchase of Xilinx seemed like a great idea at the time and AMD’s embedded sector currently enjoys an enormous operating profit margin of 40%, it’ll likely be many years before that particular acquisition actually pays for itself. I should imagine that AMD will be hoping that buying ZT Systems will bring in more money and quicker, to help offset the decline in Gaming revenue.
Now, I reckon I can scrap together $14.52—maybe even a whole 20 bucks—to acquire something, so AMD better watch out!
Take your gaming to the next level! The Redragon S101 RGB Backlit Gaming Keyboard is an Amazon’s Choice product that delivers incredible value. This all-in-one PC Gamer Value Kit includes a Programmable Backlit Gaming Mouse, perfect for competitive gaming or casual use.
With 46,015 ratings, an average of 4.6 out of 5 stars, and over 4K+ bought in the past month, this kit is trusted by gamers everywhere! Available now for just $39.99 on Amazon. Plus, act fast and snag an exclusive 15% off coupon – but hurry, this offer won’t last long!
Help Power Techcratic’s Future – Scan To Support
If Techcratic’s content and insights have helped you, consider giving back by supporting the platform with crypto. Every contribution makes a difference, whether it’s for high-quality content, server maintenance, or future updates. Techcratic is constantly evolving, and your support helps drive that progress.
As a solo operator who wears all the hats, creating content, managing the tech, and running the site, your support allows me to stay focused on delivering valuable resources. Your support keeps everything running smoothly and enables me to continue creating the content you love. I’m deeply grateful for your support, it truly means the world to me! Thank you!
BITCOIN bc1qlszw7elx2qahjwvaryh0tkgg8y68enw30gpvge Scan the QR code with your crypto wallet app |
DOGECOIN D64GwvvYQxFXYyan3oQCrmWfidf6T3JpBA Scan the QR code with your crypto wallet app |
ETHEREUM 0xe9BC980DF3d985730dA827996B43E4A62CCBAA7a Scan the QR code with your crypto wallet app |
Please read the Privacy and Security Disclaimer on how Techcratic handles your support.
Disclaimer: As an Amazon Associate, Techcratic may earn from qualifying purchases.