In a significant move, AMD announced during its Q3 earnings call that it has obtained export licenses for its Instinct MI308 AI chips, marking a pivotal step in the competitive landscape of AI technology. This development positions AMD favorably as it attempts to penetrate the Chinese market while NVIDIA faces hurdles with its H20 AI chips.
AMD Gains Ground in China with Instinct MI308
As NVIDIA grapples with uncertainty regarding the approval of its Blackwell AI chips for China, AMD confidently steps forward. The company shared its plans to offer the Instinct MI308 AI chip to the Chinese market, supported by export licenses. Despite this, AMD has chosen not to include potential China-driven revenues in their Q4 financial guidance. CEO Lisa Su highlighted this shift, emphasizing ongoing discussions with customers about demand and opportunities.
Sure, Joe. So look, it’s still a pretty dynamic situation with MI308. So that’s the reason that we did not include any MI308 revenue in the Q4 guide. We have received some licenses for MI308, so we’re appreciative of the administration supporting some licenses for MI308. We’re still working with our customers on the demand environment and sort of what the overall opportunity is.
Navigating Market Dynamics
The technical specifications of the Instinct MI308 remain under wraps, but it is anticipated to share similarities with NVIDIA’s H20 AI accelerators. This assumption aligns with compliance to US export controls. This development is critical for AMD, given NVIDIA’s exclusion from the Chinese AI sector and its prolonged delay in securing export licenses for the H20 chips. Moreover, NVIDIA faces resistance from Chinese authorities in adopting its technology stack. This situation gives AMD a slight advantage in the competitive Chinese AI market.
Despite favorable licensing, AMD’s decision not to factor MI308 sales into Q4 revenue suggests lingering unpredictability in the Chinese market. With Beijing’s focus on domestic solutions, both AMD and NVIDIA are in a holding pattern until new developments emerge. A substantial breakthrough in market dynamics is not on the immediate horizon.