Up to 400000 new AI GPUs may be shipped by AMD in 2024.

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Wednesday marks the debut of Advanced Micro Devices Inc.’s (AMD) newest chip, intended to power artificial intelligence (AI) systems. This strategic move may enable AMD to maintain competition with Nvidia (NVDA) amid the AI surge. Up to 400000 new AI GPUs may be shipped by AMD in 2024.

The Instinct MI300 graphics processing unit (GPU) accelerator for data centers is scheduled to be unveiled by the company during the AMD “Advancing AI” event on Wednesday. AMD claims that introducing the new AI processor will “accentuate the organization’s expanding momentum with AI hardware and software partners.”

AMD has previously projected that shipments of the MI300 will amount to $2 billion by 2024.

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Analysts at Wedbush Securities stated in a research note published on Tuesday that AMD’s new MI300 chip could be compared to Nvidia’s H100 at the event, with a focus on memory content and bandwidth.

Jefferies LLC analysis identifies Nvidia, one of AMD’s principal competitors, as a “best positioned” firm to acquire up to 80% of the market share from the AI craze.

The H200, Nvidia’s most recent and most potent GPU designed for use in artificial intelligence, was unveiled last month. However, reports that surfaced in late November suggested that the chipmaker would postpone the release of its new AI chip until 2024 due to integration issues with server manufacturers. Investors are concerned that U.S. restrictions on semiconductor exports to China pose a substantial risk to Nvidia, contributing to the chip delay.

Wedbush indicated in its report that Microsoft (MSFT) might participate in the AMD event, given that the tech giant has already declared its intention to incorporate AMD’s latest chip into Azure, its cloud computing division.

Wedbush analysts have written that AMD’s current investments in artificial intelligence could fuel future growth, whereas Nvidia “alone is likely to realize” an “intermediate-term” sales increase from an AI processor compared to its rival chip manufacturers.

Ahead of the introduction of the MI300 processor, AMD is a “top pick,” along with Nvidia, according to Jefferies analysts, who maintain a “positive view” on U.S. AI chipmakers in 2024.

In late trading on Tuesday, AMD shares, which have gained 85% this year, were down 0.3%.