World’s second-largest chipmaker could be a target as Samsung looks to expand hardware division
Samsung may be interested in buying Advanced Micro Devices as it looks to boost its position against such chip-making rivals as Intel and Qualcomm, according to reports coming out of South Korea.
A business publication in Seoul is reporting that the giant tech vendor is eyeing AMD, the world’s second-largest chip maker. AMD has struggled in recent years as it’s tried to adapt to a rapidly changing environment, losing ground to Intel in the server and PC chip businesses while seeing ARM and its chip-making partners continue to dominate in the mobile space and challenge it in embedded systems.
AMD has looked to extend its reach into new growth areas—including highly portable systems, dense servers, professional graphics and embedded—and saw a couple of quarters of profitability after getting its silicon into the latest game consoles from Microsoft, Sony and Nintendo. However, AMD is still greatly influenced by what happens in the volatile global PC market. In the fourth quarter 2014, the chip maker lost $364 million, and saw revenues fall to $1.24 billion from $1.59 billion the same period in 2013. AMD executives in January said they were confident that the vendor’s upcoming launch of “Carrizzo”—due in the second quarter and aimed at traditional PCs and new systems like two-in-ones—will boost the company’s financial picture.
AMD also has seen upheaval in its executive ranks, including having Lisa Su replace Rory Read as CEO last year.
However, for Samsung, getting AMD under its wing could be a boon for the company. AMD would bring a lot of intellectual property—from patents to designs to R&D—with it, and would also give Samsung some traction in the low-power server market. Samsung, which builds its own ARM-based mobile chips, in 2012 was reportedly growing its server chip expertise, with plans to build ARM-based server systems-on-a-chip (SoCs). However, the company backed away from those plans. AMD is expecting to release its first ARM-based server chip—dubbed Seattle—later this year, and has an aggressive road map for ARM server processors.
An AMD acquisition also would bring Samsung deep expertise in the x86 chip space, which is dominated by larger rival Intel, and a large graphics business. AMD was able to win the game console business through its x86 chips, so having the architectural license could be of interest to Samsung.
It’s unclear whether a deal is in the works, but the South Korean publication reported that Samsung officials had considered buying AMD in 2007.
How much do you know about microprocessors? Take our quiz!
Originally published on eWeek.