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AMD has achieved a significant milestone by surpassing Intel in datacenter sales for the first time in history. While Intel has long been the dominant force in the market for datacenter CPUs, AMD’s EPYC processors have gained a competitive edge in recent years. This shift in the market dynamic is evident in the latest revenue figures, with AMD’s datacenter segment bringing in $3.549 billion in the third quarter, outperforming Intel’s datacenter and AI group, which earned $3.3 billion during the same period.

The rise of AMD’s EPYC processors can be attributed to their performance advantages over Intel’s Xeon CPUs, as well as the competitive pricing strategies employed by AMD. For example, AMD’s most expensive 96-core EPYC 6979P processor is priced at $11,805, significantly lower than Intel’s flagship 128-core Xeon 6980P ‘Granite Rapids’ processor, which costs $17,800. As a result, Intel has had to offer significant discounts on its server chips, impacting the company’s revenue and profit margins.

While AMD’s current lead in datacenter sales is a significant achievement, the competition in the market remains fierce. Intel still holds a strong position with its high-demand Xeon 6900-series processors, and the company’s revenue may rebound if it can ramp up production of its Granite Rapids products. Additionally, Nvidia has emerged as a major player in the datacenter space, with significant sales of networking products and compute GPUs totaling $22.604 billion in Q2 FY2025.

Overall, the datacenter CPU market is experiencing a period of intense competition and innovation, with AMD, Intel, and Nvidia vying for market share and technological leadership. As datacenter workloads continue to grow in complexity and scale, the demand for high-performance processors and GPUs is expected to increase. It will be interesting to see how these industry leaders adapt to the evolving landscape and continue to drive advancements in datacenter technology.