AMD on a shopping spree: server integrator for 4.9 billion US dollars
ZT Systems is to become part of AMD from 2025. AMD's team is growing by 1,000 engineers; AWS and Microsoft are to be among the largest customers.
AMD is currently driving forward its server business in particular.
(Image: c't)
AMD is spending even more money to gain a foothold in the AI server market. If the authorities approve, AMD will acquire the US server integrator ZT Systems for up to 4.9 billion US dollars in the first half of 2025. However, AMD intends to divest part of the new subsidiary.
ZT Systems currently employs around 2,500 people, whereby AMD is primarily concerned with the 1,000 design engineers who take care of server integration in large data centers. AMD will no longer just sell the processors, (AI) accelerators and Xilinx products, but will increasingly help to build complete computing systems. In particular, this involves scaling many computing accelerators to supercomputers and controlling them via software. ZT Systems also develops cooling concepts and takes care of validations.
However, unlike Nvidia, AMD apparently does not want to design and sell its own plug-in units or even entire computing cabinets: The aim is to find a third-party buyer for the "Data Center Infrastructure Manufacturing Business". The individual servers will continue to come from manufacturers such as Dell, HPE, Lenovo and Supermicro.
The previous ZT Systems CEO Frank Zhang will head the "Manufacturing Business" in future and ZT President Doug Huang the teams for "Design and Customer Enablement". Both will report to Forrest Norrod, Executive Vice President and General Manager of the Data Center Solutions Business Group.
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AWS and Azure as core customers
So far, AMD has only benefited moderately from the AI boom. With the acquisition of ZT Systems, the company is gaining major customers in one fell swoop – according to Forbes, Amazon Web Services (AWS) and Microsoft's Azure division are among ZT Systems' biggest customers. An all-round carefree package should also make it easier for AMD to win new customers.
ZT Systems is currently a private company and therefore does not publish any annual reports. The manufacturer reportedly has an annual turnover of 10 billion US dollars. The profit margin and net profit are unknown.
(Image: AMD)
Acquisitions for more of the AI pie
AMD is paying 4.5 billion US dollars for the takeover in the form of cash and treasury shares. A further 400 million US dollars will be paid if certain (undisclosed) milestones are reached after the takeover. AMD's annual reports will include the ZT Systems figures from the end of 2025.
AMD recently completed the acquisition of the Finnish company Silo AI for USD 665 million, which trains its own large language models (LLMs), among other things. Silo AI is supposed to help with AMD's software support, for example – here the company is clearly lagging behind the industry leader Nvidia.
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