The House of Zen's new Helios racks, Venice Epycs, may dent Nvidia's dominance — if the bubble doesn't pop first
AMD has posted strong second quarter results and forecast even better future financials once its Helios rack systems and Instinct MI400-series GPUs reach buyers.“In data center AI, the growing number and scale of Helios and MI450-series deployments position the [datacenter] business for significant growth in the second half of the year, with growth accelerating in 2027,” CEO Lisa Su told investors on Tuesday during the chip design company's Q2 earnings call. “We now expect data center segment revenue to more than double year over year in 2027,” she added.Yet, despite reporting Q2 profits surging 163 percent year-over-year on revenues of $11.5 billion, and several multi-gigawatts worth of Helios commitments from the likes of OpenAI, Anthropic, and Meta in the bag, Wall Street isn’t buying it.
The company's share plunged 10.5 percent after its results announcement, before settling 8.7 percent below opening price at the time of publication.
The apparent cause for concern: AMD's growing exposure to the AI bubble. Much of the company's growth potential across both CPUs and GPUs is tied to AI adoption by a handful of companies that are yet to prove they can operate profitably.On Tuesday's earnings call, Su attempted to assuage investor fears, but in the same breath she said the quiet part out loud. “When we talked about the large frontier-model companies, OpenAI, Anthropic, Meta, they will be consuming through a number of CSPs,” Su said. “There are additional customers or lots of customers who are interested in Helios at, let's call it, a more regular scale than gigawatt scale.”In other words, while AMD can sell plenty of GPUs, most are sold to a handful of customers. And while other entities have AMD on their shopping lists, they don't buy in bulk.Microsoft, another flagship customer for AMD's latest generation of AI picks and shoves, serves both OpenAI and Anthropic, while Meta is reportedly looking to enter the GPU cloud biz itself.Despite this, AMD remains optimistic about its prospects over the next few quarters.It's not hard to see why because since the launch of its MI300-series GPUs in late 2023, AMD has established itself as the most credible alternative to Nvidia.At its Advancing AI event in San Francisco last month, the company showcased a new rack-scale compute platform called Helios packing 72 Instinct MI455X GPUs each with 432 GB of HBM4 memory on board.
