AMD bounces nearly 9% on a declaration Microsoft is cooperating on an A.I. chip inspiration

May 5, 2023: On Thursday, AMD shares reached a session elevated following a media report which claims the chipmaker to work with Microsoft on a recent artificial intelligence processor.

Microsoft’s top rivals in the cloud infrastructure business, Amazon and Alphabet, have specialized chips that software developers can use to train models. But Microsoft to date has yet to release a special-purpose A.I. chip. The one in growth in partnership with AMD carries the code name Athena, and it will be training the models and making inferences on new data, Bloomberg stated.

Microsoft helps AMD to fund the initiative, Bloomberg reported, citing anonymous sources.

Nvidia shares moved lower following the report. Like other large technology companies, Microsoft uses Nvidia graphics processing units to run A.I. models.

The need for silicon that can handle A.I. has become more critical than ever in the previous six months, particularly at Microsoft, which provides the computing resources for new business OpenAI’s viral ChatGPT chatbot. The technology has needed thousands of Nvidia GPUs, Microsoft has said.

But Microsoft needed chips to run its applications that are drawing on the GPT-4 large language model at the centre of ChatGPT.

Large language models are from a class of generative A.I. technologies that can make content such as text as a reply to human input. Microsoft’s Bing chatbot contains the GPT-4 model, and the software owner has announced security and productivity deals that will also use it.

AMD is a chip supplier to Microsoft and other cloud providers like Google and Oracle.