Despite its small size, amd plays an important role in the chip world. In the two important areas of semiconductor industry, only it can compete with the two giants substantially at the same time. Its CPU, a universal chip at the heart of modern laptops, desktops and data centers, competes with Intels products. Intel GUI is the second largest chip manufacturer in the world, with revenue of US $71 billion in 2018. AMDs GPU, which provides 3D graphics for video games, and increasingly computing power for increasingly popular machine learning algorithms, competes with NVIDIA, which generated $11.7 billion in revenue last year, almost double amds.
AMDs outstanding performance mainly comes from its competition with Intel. Intel has almost always monopolized the CPU market, which has only changed in recent years. Analysts at Mercury research, a market research firm, estimate that Intels chips accounted for 92.4% of the desktop and laptop market in 2015, and an astonishing 99.2% of the more lucrative server chip market. According to the latest data, AMDs share in the desktop and laptop market is 14.7%. In the server chip market, its share is only 3.1%, but it has increased fourfold compared with two years ago.
There are two factors that can explain AMDs recovery. One is product improvement. In 2012, the company hired a respected chip designer, Jim Keller. Keller worked for apple. Amd has long adopted a low price strategy in the market competition - its chips are slower than Intels, but much cheaper. Kellers Zen chip, released in 2017, is still cheap. But they are as good as, or even better than, Intels chips: for example, AMDs high-end server chips can handle many tasks faster than Intels like products, and cost only half of Intels. Zen chips have won a series of contracts with companies such as Microsoft, Sony (for new game consoles), Google (for data centers) and Cray (for supercomputers).
The second factor is that Intel is faltering as amd improves its products. Intel makes its own chips. Its latest and best manufacturing process should have brought about a huge performance improvement, but it was delayed for several years, making the company have to re-examine the existing design. Amd outsources most of its manufacturing to TSMC, which is now catching up with Intels technology.
Can the good momentum of AMD continue? Intel ended similar competition at the turn of the century and in the middle of the first decade of this century. Now AMD is once again trying to make an impact. The company plans to introduce an advanced new manufacturing process in 2021. The GPU program is also expected to allow AMD to make significant progress in another area.
Source: Wang Fengzhi, editor in charge of Netease Technology Report