Advanced Micro Devices (AMD, Financial) has sold its server production business, which it acquired from ZT Systems, to Sanmina for $3 billion. However, AMD has retained the AI systems design segment of ZT Systems.
Citing a Citigroup analyst report, multiple media sources suggest that AMD preserved the team of 1,200 engineers from ZT Systems to compete with NVIDIA (NVDA). This strategic move is estimated to cost AMD $1.6 billion.
Previously, NVIDIA announced a $4.9 billion acquisition of ZT Systems and completed the transaction in March. At that point, NVIDIA had already indicated plans to sell off the server production operations.
