AMD overtakes Intel for the very first time
AMD overtakes Intel in the data center segment for the first time. But while both chip giants are fighting for market share, Nvidia is putting both of them in the shade with AI chips. However, the development is particularly worrying for one company: industry veteran Intel.
Turning point in the data center market
The world of data centers is experiencing a historic moment: For the first time, AMD has overtaken its competitor Intel in sales figures. This development marks a significant turning point in the industry and underscores the increasing competitiveness of AMD’s EPYC processors against Intel’s long-standing Xeon dominance.
In the third quarter of 2024, AMD’s data center division had sales of $3.549 billion, while Intel’s data center and AI group had sales of $3.3 billion. This is even more impressive when you consider that AMD still had a single-digit market share just a few years ago.
AMD’s recipe for success
Tom’s Hardware calculates that AMD’s success is primarily due to the performance and cost efficiency of the Epyc processors: AMD’s most expensive 96-core Epyc 6979P processor costs $11,805. In contrast, customers pay $17,800 for Intel’s flagship, the 128-core Xeon 6980P (“Granite Rapids”). This pricing forces Intel to discount prices, which in turn hurts the company’s sales and margins.
Despite AMD’s success and Intel’s traditional strength, the industry has recently welcomed a new giant, Nvidia. The company dominates the market for AI hardware in data centers with its AI GPUs and network chips. With sales of over $26 billion in the second quarter of fiscal 2025 alone, Nvidia far exceeds the combined data center sales of Intel and AMD.
Unusual partnerships in the chip world
What’s notable is that despite their long-standing rivalry, AMD and Intel recently joined forces to jointly shape the future of x86 architecture. This unusual alliance aims to strengthen the position of the x86 architecture against the emerging ARM technology, which is gaining traction in the laptop market thanks to Qualcomm’s Snapdragon X processors.
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