(News Bulletin 247) – AMD shares (+0.5%) are hovering around equilibrium on Monday morning after jumping more than 6% last Friday on speculation around a possible cooperation with Microsoft in the field of artificial intelligence.

According to several market sources, the two groups are planning to collaborate in order to design ‘tailor-made’ artificial intelligence (AI) processing processors intended to compete with the graphics processing units (GPUs) developed by Nvidia.

“Microsoft reacted to the article by assuring that AMD was not a stakeholder in its ‘Athena’ project, which since 2019 has aimed to develop an in-house chip intended for artificial intelligence”, underline New Street analysts Research.

‘But Microsoft recognized at the same time that AMD was an exceptional partner,’ adds the independent consultancy.

According to New Street, a possible collaboration between AMD and Microsoft would make sense insofar as the two groups “work together for many years on the chips that equip the Xbox”.

Analysts believe that their partnership could be closer to that set up by Google and Broadcom as part of their ‘tensor processing unit’ (TPU) project.

“In this specific case, AMD would provide Microsoft with the advanced design capabilities needed to develop an AI processor,” explains the London firm.

‘More specifically, Microsoft will have to rely on intellectual property and expertise in interconnects and networks, an area in which AMD has gained momentum thanks to the acquisition of Xilinx’, continues New Street.

“If the partnership were a success, it could represent a new source of income for the semi-custom branch of AMD”, he adds, specifying that, in the case of Broadcom, this diversification should generate around three billion additional dollars per year, mainly from the collaboration with Google.

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