AMD is in the semiconductor business, and a large part of it now entails massive data center operations. Efficiency becomes increasingly important as the size grows, and being able to maximize efficiency for certain workloads becomes more important.
AMD announced today that it plans to buy Pensando, a data center optimization startup, for $1.9 billion. A programmable packet processor is one of the company's products, and it manages how workloads move through the hardware infrastructure, shifting work away from the CPU whenever possible to improve performance. The business claims that its solution performs 8x to 13x better than competing products from Nutanix, VMware, Cisco, and others.
According to AMD chair and CEO Lisa Su, the acquisition is aimed at assisting data center operators in lowering their total cost of ownership by utilizing software to extract every last ounce of efficiency.
"With the addition of Pensando to our high-performance CPU, GPU, FPGA, and adaptive SoC portfolio, we now have a leading distributed services platform." In a statement, she added, "The Pensando team combines world-class knowledge and a demonstrated track record of innovation at the semiconductor, software, and platform level."
Prem Jain, the CEO and co-founder of Pensando, described the purchase as allowing the company to develop quickly within the broader corporation than it could on its own. "Joining forces with AMD will help us accelerate growth in our core business and enable us to target a much broader client base across a wider range of sectors," he added. When the deal is completed, Jain will join AMD's data center solutions group.
This provides AMD a vital set of software tooling within data centers, according to Patrick Moorhead, founder and chief analyst at Moor Insight & Strategies, who maintains a close eye on the semiconductor business. "Network offload is performed by NPUs (neural processing units) and IPUs (infrastructure processing units) so that the server can deliver a constant level of performance for applications. "While the approach necessitates the use of chips and cards, the framework is entirely defined by software," he stated.
Overall, Moorhead believes it is a solid purchase for AMD, as it provides the firm with skills that it previously lacked. "This establishes AMD's presence in the NPU or IPU market." Intel, Nvidia, and Marvell will all be competitors. Pensando has a diverse set of enterprise and cloud clients. He answered, "I like it."
According to Crunchbase statistics, the firm was founded in 2017 and has raised over $300 million from investors such as Lightspeed Ventures, Qualcomm Ventures, and Hewlett Packard Enterprise. Microsoft Azure, Oracle Cloud, and Goldman Sachs are among the clients.
According to AMD, the actual price of this acquisition will be determined when they calculate working capital and other adjustments from Pensando. Despite this, the purchase is likely to finalize in the second quarter, pending regulatory approval.