- AMD, Cerebras Systems, and Altera executives explain the importance of competition in the chips world at Fortune’s Brainstorm AI in San Francisco on Tuesday.
In the world of AI chips, Nvidia is the $3 trillion Goliath. But the massive shadow Nvidia casts over the market isn’t scaring off a gang of challengers ranging from longtime chip players to young startups.
“The market demands competition, and so we’re getting a tremendous pull,” said Mark Papermaster, executive vice president and chief technology officer of Advanced Micro Devices, at Fortune’s Brainstorm AI conference on Tuesday.
AMD began decades ago as a maker of PC microprocessors, but has also developed a robust business designing and selling GPUs, the AI-friendly class of chips that are at the heart of Nvidia’s booming business. While AMD’s GPUs were once geared for video gaming and entertainment applications, the company is now aiming straight for the AI training market.
“We went from almost zero in 2023 of AI revenue to five billion projected this year…the market needs competition, and that’s what we’re focused on,” said Papermaster.
Andrew Feldman, co-founder and chief executive of Cerebras Systems, suspects there are so many players because the AI market is so big. It isn’t just Nvidia or AMD, it’s hyperscalers or startups “seeing opportunity explode and wanting to do their own chips.”
“It’s because you have this explosion of demand,” Feldman said. “We’re seeing it on the training side, we’re seeing it on the inferencing side—and I think, truth be told, none of us can keep up.”
Competition isn’t just better for competitors, Feldman continued, it’s better for consumers because it means the AI in their applications will run faster and cost less. “Mark’s GPUs are running faster than Nvidia’s,” he said, referring to AMD's Papermaster. “Our accelerators are running, in many instances, 75 times faster than Nvidia’s," he claimed.
Speed matters. Feldman mentioned the days of the internet before broadband, calling it a disaster.
“Once we got broadband, all of a sudden, you had new applications, you had streaming, you had all these things that were fun, and the engagement was high,” he said. “And I think that’s what's happening right now with AI, is that as you get faster, you move into the sort of the broadband era of AI inference.”
It's also worth remembering that generative AI is still in its very early stages. “There’s so much innovation ahead of us,” said Sandra Rivera, chief executive of Altera. To Rivera, it isn’t about taking on Nvidia, it’s about creating the best device for whatever you’re attempting to do because chips aren’t one size fits all. As AI models and applications evolve into different versions, for instance, the processing power necessary to run it will reside on "edge" devices like smartphones and appliances, as well as inside data centers.
“Competition is good,” she said. “It makes you sharper, makes you more focused, and it certainly addresses the very, very broad customer requirements that are out there.”
The market demand for AI chips is creating an opportunity for investors too. Cerebras filed paperwork in September for an initial public offering, though Feldman declined to comment on the status or timing for the listing. Rivera said that Altera, which is owned by Intel, is still planning for a floatation in 2026. Intel, which acquired Altera in 2015, has been roiled by business challenges that led to CEO Pat Gelsinger resigning last week.
Despite the changes at Intel, Rivera said that the plan was still for Intel to sell an equity stake in Altera and for a 2026 IPO. “We’re in the middle of that process now with a lot of great interest, which is encouraging,” she said, later adding, “the news from last week was sad on so many levels, but what I try to keep the company and the employees focused on is the things that we control.”
