AMD (AMD.US) officially separates from ZT Systems manufacturing department and launches a full-stack AI solution.

PC and data center chip leader AMD (AMD.US) announced on Monday local time that it has completed the divestiture of its ZT Systems data center infrastructure manufacturing business, based in the United States, and transferred it entirely to Sanmina (SANM.US), a company focused on electronic product manufacturing services. This move by AMD not only allows them to achieve positive cash flow in the short term, but also aims to enable the chip giant to concentrate its resources on building and accelerating the delivery of its high-performance "CPU + GPU + software architecture" AI developer full-stack rack-level exclusive platform in a lighter asset and more operationally efficient manner. In a press release, the company stated that as part of the transaction, AMD will retain ZT Systems' world-class design and customer empowerment team to accelerate the quality and performance improvement of AMD AI compute clusters for AI cloud computing customers and significantly reduce deployment cycles. At the same time, Sanmina has officially become AMD's preferred new product introduction (NPI) manufacturing partner for AMD's cloud AI server compute rack and large-scale cluster-level AI supercomputing infrastructure solutions. "Our strategic partnership with Sanmina combines the hardcore manufacturing strength of the United States with AMD's expertise in AI compute system design and customer empowerment, allowing us to achieve high-quality growth, extremely fast deployment, and high flexibility at a scale level," said Forrest Norrod, Executive Vice President and General Manager of AMD's Data Center Solutions Business Unit. This latest statement means that AMD has transferred the "heavy asset traditional manufacturing business" of ZT to Sanmina, while retaining ZT's rack-level AI solution design and customer empowerment team to improve quality and shorten deployment cycles for cloud customers. Sanmina is also designated as the preferred NPI manufacturing partner in the United States and responsible for mass production of AMD's cloud rack and cluster-level AI solutions. AMD's official stance and management expression leave system design/solutions and customer delivery at AMD, while handing over heavy asset manufacturing to Sanmina, to achieve "quality, speed, and flexibility" in scaled delivery. With the release of the Helios rack-level AI compute super platform (targeting competitors such as NVIDIA Corporation, Dell Technologies, Inc. Class C and other AI complete machine/cabinet computing solutions) on OCP, AMD has outlined the path for a full-stack AI system at the rack level with "CPU+GPU+high-performance network+ROCm software stack" for AI developers, with the goal of deploying AMD AI compute solutions for large customers. Since the beginning of the year, AMD's stock price has risen by over 110%, with the majority of the gains concentrated in the past month. AMD's market capitalization ranking among the S&P 500 index component stocks has also jumped from 44th at the beginning of the year to 21st, with a market capitalization exceeding $410 billion and continually setting new highs. The recent strong growth of AMD is mainly driven by a significant AI compute infrastructure cooperation agreement with the AI application leader OpenAI, worth billions of dollars. This not only validates the strong capabilities of AMD's AI compute infrastructure technology but also makes Wall Street investment firms more optimistic about its future financial prospects. HSBC reiterated its "buy" rating on AMD (AMD.US), a long-term competitor of NVIDIA Corporation, in its latest bullish report, raising its target price from $185 to $310, the highest target price level on Wall Street. Analyst Lee wrote that the recent deal with OpenAI presents a more favorable bullish outlook, improving performance forecast clarity and market bullish sentiment, and added that there may be further upside potential from pricing premiums and additional AI GPU shipment expansion. As of the close of the U.S. stock market last Friday, AMD's stock price closed at $252.92.