AMD’s Record US$11.5bn Quarter: What’s Behind the Growth?

AMD said it will acquire chip startup Taalas for an undisclosed price to strengthen its AI inference technology. Taalas, based in Toronto, makes specialized silicon aimed at reducing computing and memory bottlenecks for AI inference. AMD plans to integrate the tech into its accelerator roadmap and build system solutions with AMD Instinct GPUs. Taalas raised $169 million in February, totaling about $219 million.

AMD will acquire AI inference chip startup Taalas, which builds hardwired chips for specific AI models. Taalas says its chips run thousands of times faster than conventional GPUs on targeted models. AMD also ships its Helios rack-scale system and plans to integrate Taalas designs into future systems. The deal targets low-latency workloads alongside AMD’s GPU business.

AMD reported Q2 results that beat on revenue and earnings and raised guidance, while projecting capital expenditures to more than double to $808 million from $389 million to expand capacity for EPYC processors and Helios rack-scale AI systems. The higher spending may pressure margins and free cash flow near term, contributing to a negative stock reaction, but management expects strong data center growth.

AMD said on Aug. 6 it agreed to acquire Taalas, a Toronto AI inference silicon startup founded in 2023. AMD did not disclose deal terms. Taalas builds chips that hardwire model weights into silicon and claims a TSMC N6 flow can produce a model-specific chip in about two months. AMD plans to integrate the technology with Instinct GPUs and its ROCm software stack.

Intel, AMD and Micron shares hit 52-week highs as investors bought into AI-infrastructure related chip demand. Intel gained after reports Apple may use Intel foundries for future iPhone and Mac chips. AMD rose on Tuesday’s Q1 results, with $10.3B revenue (+38% YoY) and $5.8B data center revenue (+57% YoY), plus raised price targets. Micron also advanced amid tighter AI memory supply.

AMD said it plans to acquire AI chip startup Taalas to strengthen its position in artificial intelligence hardware and compete more directly with NVIDIA. The deal would give AMD AI-optimized chip technology, engineering talent, and IP, supporting its data center and AI accelerator roadmap as demand for AI computing rises.