‘Instincts are massively cheaper than Nvidia’s H100’: AMD is selling flagship AI GPUs at a huge discount to Microsoft — but I’m not sure that will be enough to bother Nvidia

Key Takeaways:

– AMD’s flagship AI GPUs, the Instincts, are being sold at a significant discount to Microsoft, providing a competitive alternative to Nvidia’s pricier H100.
– Nvidia’s H100 AI GPUs cost up to four times more than AMD’s competing MI300X, with prices peaking beyond $40,000.
– Despite the price advantage, AMD’s market strategy is not expected to significantly impact Nvidia’s stronghold in the AI GPU market due to Nvidia’s established CUDA software stack and overwhelming demand for its GPUs.
– AMD recently raised its guidance for artificial intelligence-related revenue to $3.5 billion this year, up from $2 billion, but Citi analyst Christopher Danely predicts that AMD’s sales figures could be underestimated and expects revenue of $5 billion this year and $8 billion next year from the MI300.
– Microsoft and Meta are reportedly the largest customers for the MI300, with Microsoft paying an average selling price of roughly $10,000 and other customers paying $15,000 or more.
– Risks remain for AMD, including the potential end of the PC space replenishment and Intel catching up to Taiwan Semiconductor in manufacturing.
– Nvidia does not disclose the pricing of its H100 80GB products, making it difficult to compare directly with AMD’s Instincts.
– While AMD’s Instincts are much cheaper than Nvidia’s H100, the impact on Nvidia’s market position is uncertain due to Nvidia’s software infrastructure and high demand.
– AMD’s sales of data center GPUs are expected to exceed $3.5 billion, providing a contrast to Nvidia’s rumored 52-week wait times, but AMD’s price advantage may not be enough to disrupt the market significantly.

TechRadar:

AMD‘s flagship AI GPUs, the Instincts, are being sold at a significant discount to Microsoft, offering a competitive alternative to Nvidia‘s pricier H100. According to Tom’s Hardware, Nvidia’s H100 AI GPUs cost up to four times more than AMD’s competing MI300X, with prices peaking beyond $40,000.

Despite the price advantage, AMD’s market strategy is not expected to significantly impact Nvidia’s stronghold in the AI GPU market. This is due to Nvidia’s established CUDA software stack, which has been optimized for a wide range of AI applications and workloads, resulting in overwhelming demand for its GPUs. 

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AI Eclipse TLDR:

AMD’s flagship AI GPUs, the Instincts, are being sold at a significant discount to Microsoft, providing a competitive alternative to Nvidia’s pricier H100. According to Tom’s Hardware, Nvidia’s H100 AI GPUs cost up to four times more than AMD’s competing MI300X, with prices reaching beyond $40,000.

Despite the price advantage, AMD’s market strategy is not expected to heavily impact Nvidia’s stronghold in the AI GPU market. This is because Nvidia has an established CUDA software stack that has been optimized for a wide range of AI applications and workloads, leading to overwhelming demand for its GPUs.

AMD recently raised its guidance for artificial intelligence-related revenue to $3.5 billion this year, up from $2 billion. However, Citi analyst Christopher Danely believes that AMD may be underestimating sales figures intentionally. He predicts that AMD will generate $5 billion this year and $8 billion next year from the MI300.

Microsoft and Meta are reportedly the largest customers for the MI300, with Microsoft’s average selling price being around $10,000 and other customers paying $15,000 or more.

Despite AMD’s aggressive pricing strategy, there are still risks involved. The PC space replenishment might be over, and Intel is catching up to Taiwan Semiconductor (TSM) in manufacturing.

Furthermore, AMD’s sales figures could be affected by the fact that Nvidia does not officially disclose the pricing of its H100 80GB products, which depends on various factors such as batch volume and overall volumes procured by a specific client.

While AMD’s Instincts are significantly cheaper than Nvidia’s H100, the impact on Nvidia’s dominant market position remains to be seen. AMD’s sales of data center GPUs are expected to exceed $3.5 billion, and with supply still available, it presents a stark contrast to Nvidia’s rumored 52-week wait times. However, given Nvidia’s established software infrastructure and high demand, AMD’s price advantage may not be enough to significantly disrupt the market.