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What's Next For AMD?

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AMD is in the midst of a refresh to its entire product portfolio. AMD began with the successful launch of the consumer desktop PC version of Ryzen last week and additional details of its Zen server processor, code name Naples, was revealed this week. In the second quarter, AMD will launch Naples and a new high-performance GPU, code named Vega. Needless to say, the folks at AMD have been very busy. At this stage, it looks like the company is executing pretty much on plan.

Ryzen Processor Logo

There were some glitches in the Ryzen launch, but those appear related to updated motherboard bios and other software optimizations for the chip. While AMD makes the chip and provides software support, it doesn’t control the entire ecosystem. Some of the gaming benchmarks and games have shown that the Ryzen chip is not well optimized for 1080p resolutions, but this is a temporary situation that will be resolved with new bios, new drivers, and software patches. This is a brand-new chip, with a new architecture, and there will be some growing pains as software developers become more familiar with the processor and perform optimizations specifically for it. This actually quite typical for any new architecture launch. All the fundamentals of the Ryzen chip and its Zen CPU core are exactly what AMD promised and then some.

AMD Re-Enters the Server Market

The next major segment for the AMD refresh is servers with the Naples processor. Naples has four times the number of cores as the consumer Ryzen chip because it is four Ryzen-like eight-core die assembled in a multi-chip package (MCM). Those die are connected using AMD’s new Infinity Fabric for seamless and linear scaling. At the Open Compute Summit, AMD will be showing some early system with Naples, including Microsoft’s Olympus OCP platform. Naples will support both single and dual socket configurations.

Source: AMD

Today’s data-center-server systems are very heavily dual socketed, but even AMD’s single socket solution has significant amount of CPU cores, I/O, and memory bandwidth that it may make a single-socket solution as performant as many of Intel’s dual-socket solutions. Naples contains an outstanding number of PCI Express lanes (128) and memory bandwidth from eight memory channels feeding 32 CPU cores to make it a very high-performance server CPU. This could be a real disruption to Intel's server market strategy, especially scale-out servers.

AMD "Naples" Dual-Socket Server

TIRIAS Research

With approximately a 0% market share, AMD has nowhere to go but up, and in the process, make life difficult for Intel.

Refreshed Radeon Graphic

Not to be left out of this complete redesign of AMD’s products portfolio is high-performance Radeon graphics with the launch of the Vega GPU architecture. AMD has been making small market share gains (Mercury Research reported that AMD's share of desktop discrete graphics went from 20.3% in Q4 2015 to 27.6% in Q4 2016), but NVIDIA still has the larger share and holds the high ground on performance and high-priced graphics cards (reference 1080Ti article). Vega offers AMD a chance to raise its game and gain more share. It’s too early to tell if Vega can outperform NVIDIA’s new GTX 1080 Ti GPU, but AMD doesn’t need to win the top end of the market to do well in the volume and profitable segment for boards below $499. These still qualify for VR at the higher end of the segment. The new Vega architecture will also have better support for deep neural net convolution and lower precision math used for inference. Vega will allow AMD to make a bigger push in machine learning and AI. The company is also investing in more AI development tools.

Mobile Completes the Product Suite

Finally, AMD will launch a mobile processor (Raven Ridge) with the Zen CPU and a Vega-derived GPU in the second half of the year. At that point, the company would have a completely refreshed product line heading into 2018. It’s quite an accomplishment for a company that’s a fourteenth the size of Intel and that many had counted out as recently as last year.

AMD hinted at other things in the works for 2018 and beyond. AMD has Zen 2 and Zen 3 CPUs in development. When AMD completed definition the first generation Zen, there were features that missed the design cut-off, plus there are additional learnings from evaluating the first generation product’s performance in the field. Those features and learnings are fed forward into next generation designs. This means there’s more performance that AMD can bring in the next few years, as well as the benefits of the future 7nm process node.

There are also rumors that AMD has a deal in the works to license Intel GPU patents and additionally AMD could supply Radeon die for a MCM with an Intel Core processor. This may be controversial and it’s still just a rumor, however, it would have significant long-term benefits for AMD. While any deal to supply Intel with Radeon GPUs could hurt AMD’s processor sales, such a part would likely be expensive and only address a high-end SKU. Such an MCM would also likely be at the request of an OEM like Apple, which already uses AMD discrete GPUs in conjunction with Intel CPUs, but also values thin form factors, low power, and superior graphics. Apple can also offset the cost because it can command a high price for its notebooks. Despite any collaboration with Intel, AMD’s processors would still have the benefit of a tighter integration between the CPU and GPU, theoretically resulting in higher overall performance and smaller solution.

As I pointed out in a previous article, AMD is about to have a rocking 2017. The stock price already reflects greater optimism about the company. But even without an Intel deal, AMD is gaining momentum. If there’s no disruption in its plans, the company should hit its stride in 2018.

Kevin Krewell

Principal Analyst, TIRIAS Research

-- The author and members of the TIRIAS Research staff do not hold equity positions in any of the companies mentioned. TIRIAS Research tracks and consults for companies throughout the electronics ecosystem from semiconductors to systems and sensors to the cloud.