Is AMD Splitting Up

AMD has denied rumors that it will split up its business in a bid to rival chip giant Intel.

Sources close to AMD said that the company is planning to divide into two, or spin off certain parts of the business, in order to make it a stronger force in the chip industry.

Three sources familiar with the matter told Reuters that AMD is at the initial stage of reviewing, and has asked a consulting firm about its options in trying to turn the company around. The sources said that the deliberations are preliminary and that no decision has been made.

Apparently, one of the options under consideration is separating AMD’s graphics and licensing business from its server business, which sells processors that power data centres.

However, AMD has since denied such speculation. “While we normally would not comment on such a matter, we can share that we have no such project in the works at this time,” a company spokesperson said.

“We remain committed to the long-term strategy we laid out for the company in May at our Financial Analyst Day.”

If the rumours happen to be true, though, and AMD does split its company into two, it would make it the second major technology firm to do so in the past year.

PC maker HP confirmed in October that it would tear itself in half, making two new publicly traded Fortune 50 companies. The decision was down to the firm wanting to focus on the faster growing side of the business.

HP’s split is expected to be completed by the end of this year. HP’s enterprise technology infrastructure, software and services businesses will do business as Hewlett Packard Enterprise, and the firm’s market-leading personal systems and printing businesses will operate as HP Inc and retain the current logo.

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Will ARM Servers Help HP’s Bottom Line?

The maker of expensive printer ink HP expects new lower-power servers made with technology from ARM Holdings to make inroads in niche data centres over the next year. If vice president of server engineering Tom Bradicich is right, then it could give Intel a good kicking in its bottom line.

Bradicich said that penetration is low at the moment because the ARM chip was starting from nothing but the take-up is pretty encouraging. HP this week launched new servers made with chips designed by Applied Micro Circuits with intellectual property licensed from ARM. ARM’s supporters, which now include HP say some data centres can be made more cost effective and energy efficient by using them instead of Intel’s server chips.

Bradicich said HP’s new 64-bit ARM-based servers were ideal for handling specialized data-centre workloads like search and scientific analysis. Sandia National Laboratories and the University of Utah plan to use HP’s new servers for scientific analysis and high-performance computing, while PayPal plans to use another version of the servers.

With AMD and other chipmakers working on their own ARM server chips, variety is a key factor for customers that have long depended on Intel, Bradicich said.

Intel has launched its own line of “Atom” low-power server chips to counter the ARM threat. HP offers servers made with Atom chips but said they are not selling that well.

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