Advanced Micro Devices Stock Declines 5% Despite Launching New AI and Server Chips

Advanced Micro Devices (AMD) has announced plans to significantly increase production of its new artificial intelligence M1325X chip, aiming to start in the fourth quarter. This move is part of the company’s strategy to challenge rival Nvidia and capitalize on the growing demand for AI-related hardware.

The MI325X chip, utilizing the same architecture as the MI300X, introduces a new type of memory designed to accelerate AI tasks, as detailed during AMD’s AI event held in San Francisco.

AMD has partnered with vendors, including Super Micro Computer, to begin shipping the new AI chip to customers in the first quarter of 2025. The company believes this will help it compete against Nvidia’s Blackwell AI chips effectively.

As for the future, AMD is set to unveil its next-generation MI2350 chips in the latter half of next year. These new chips are expected to be more powerful than the MI325 series, thanks to improved memory and an upgraded architecture.

Additionally, AMD introduced a new version of its server chip, which was previously codenamed Turin.

Despite these advancements, AMD’s shares recently experienced a downturn, with prices falling over 3%.