AMD to acquire server maker ZT Systems for $4.9 billion

The transaction is expected to close in the first half of 2025, with ZT Systems contributing to AMD’s financial performance by the end of that year.
AMD chip

AMD announced plans to acquire server maker ZT Systems for $4.9 billion, aiming to strengthen its position in the AI hardware market and compete with industry leader Nvidia. The acquisition will be financed through a combination of cash and stock, with AMD leveraging its $5.34 billion in cash reserves. That strategic move is intended to enhance AMD’s ability to meet the growing computing demands of AI, where the integration of vast numbers of chips into powerful server systems is crucial.

ZT Systems, which generates about $10 billion in annual revenue, will bring approximately 1,000 engineers to AMD, allowing the company to accelerate the testing and deployment of its AI GPUs on a larger scale, particularly for major cloud providers like Microsoft. AMD’s CEO, Lisa Su, emphasised that AI systems are the company’s top strategic priority and expects the acquisition to boost GPU sales significantly. However, AMD plans to divest ZT Systems’ server manufacturing business post-acquisition, as it does not intend to compete in that segment.

The deal is expected to close in the first half of 2025, with AMD anticipating a positive impact on its financial performance by the end of that year. The following acquisition is part of AMD’s broader strategy to challenge Nvidia’s dominance in the AI hardware space, where Nvidia is projected to generate $105.9 billion from its data centre segment this year.