Nvidia announced its plans to make a server processor chip for data centers — that will be powered by Arm Ltd — putting it in the most direct competition yet with rival Intel.
Intel is the world’s biggest maker of central processors for data center servers but has increasingly seen competition from Arm-based chips. Nvidia will be the largest chip company so far to challenge Intel in its key market with its “Grace” server processor.
Arm’s technology powers the chips in most smartphones, but for the last several years has been making its way into data centers, with companies such as Amazon.com and Ampere Computing designing chips for servers with it, Reuters reported.
Nvidia’s entry into the market could hasten Arm’s inroads into data centers. Nvidia’s chips have been used as “accelerators” alongside existing central processors from Intel, Advanced Micro Devices or others, offloading some computing work from them and speeding up the overall computing system.
By making its own central processor, Nvidia is taking on Intel and AMD directly for the first time. Nvidia Chief Executive Officer Jensen Huang called the new server chip the “final piece of the puzzle” that will join Nvidia’s graphics and networking chips to form the “basic building block of the modern data center.”
Santa Clara, California-based Nvidia said the “Grace” server processor, which will be released in 2023, is designed to handle tasks like training artificial intelligence algorithms.
Nvidia said that the Swiss National Supercomputing Centre will make a new supercomputer dubbed “Alps” using the new “Grace” processors and built by Hewlett Packard Enterprise (HPE). The computing system will be 10 times faster than the world’s current best supercomputer, Huang said.
Nvidia officials said that the company’s accelerator chips will continue to support central processors from Intel and AMD even as it dives into the market itself. Huang said that Nvidia will alternate its focus, concentrating on making accelerator chips that work with Arm-processors one year, and then chips that work with AMD and Intel chips in the next year.
Nvidia said in September that it will buy Arm for $40 billion.
Nvidia’s rivals have expressed concerns that the company will use its potential ownership of Arm to get early access to Arm’s technologies as they become more prevalent in the data center market.
Nvidia expects sales to exceed $5.3 bn in first-quarter
Nvidia Corp’s first-quarter revenue will be above its earlier forecast of $5.3 billion, the chipmaker said on Monday, as it benefits from strong demand for chips that power data centers and cryptocurrency mining.
Demand for Nvidia’s gaming graphic chips has soared during the COVID-19 pandemic, but the bigger boost to its sales has come from an aggressive push into artificial intelligence chips, which handle tasks such as speech and image recognition in data centers
“While our fiscal 2022 first quarter is not yet complete, Q1 total revenue is tracking above the $5.30 billion outlook,” Chief Financial Officer Colette Kress said in a statement.
Nvidia’s unit that supports cryptocurrency mining is now expected to report sales of $150 million in the quarter, up from previous forecast of $50 million, the company said.
The company’s upbeat forecast comes even as the chip industry continues to reel from a global shortage of components, disrupting wide-scale manufacturing of products including vehicles and smartphones.
“We expect demand to continue to exceed supply for much of this year,” Kress said.