Can AMD outsmart Nvidia with $665 Million Silo AI deal?

Advanced Micro Devices on Wednesday said it will acquire Finnish artificial intelligence startup Silo AI for about $665 million in cash in an increasingly competitive landscape of AI chips. The transaction is part of a bid to improve AMD's AI chip capabilities to better compete with arch-rival Nvidia Corporation.

Training and developing large language models is a complex task, even for the largest tech companies. The Silo AI acquisition will let AMD further develop and deploy AMD-powered AI models and help potential customers build complex AI models with the company's chips, AMD said.

The acquisition is likely to beef up AMD's software development efforts as well. While the transaction will not have any immediate impact on AMD's financials, it "unlocks a significant amount of business moving forward," AMD Senior Vice President of AI, Vamsi Boppana said in an interview. However, AMD did not give any concrete estimates for the business that this acquisition would generate.

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Silo AI is a Helsinki, Finland-based startup offering end-to-end AI-driven solutions to customers by the integration of AI technology into their products and services. Working across Europe and North America, this company has operated with some of the most recognisable brands, such as Philips, Rolls-Royce, and Unilever.

Peter Sarlin, CEO and co-founder of Silo AI, will still be at the helm to lead the unit as part of the AMD Artificial Intelligence Group, AMD said. The deal is expected to close in the second half of 2024.

This acquisition is the latest in a series of strategic moves aimed at furthering AMD in the AI space. AMD also purchased AI software firms Mipsology and Nod.ai last year, and it has invested over $125 million in a dozen AI companies over the past 12 months.