How AMD Became a Chip Giant and Finally Caught Up to Intel

After being on the brink of bankruptcy for almost a decade, it was this year when Advanced Micro Devices (AMD) made history and surpassed Intel with a ~$197.75 billion market cap for the first time.

AMD is one of the biggest names in the technology world, having been at the forefront of innovation in the computer industry for many years. But despite its successes, AMD has been on a rollercoaster ride for over the last decade, culminating with an incredible renaissance this year.

Now, the question is how AMD rose from the ashes and became a top contender in the tech industry again.

The Rise of AMD

Advanced Micro Devices, Inc. (AMD) is a multinational semiconductor company founded in 1969 by eight former employees from Fairchild Semiconductor.

In the 1970s, the company introduced the world's first commercially available 64-kilobit dynamic random-access memory (DRAM) chip, which became a crucial component in developing personal computers.

In the 1980s, AMD decided to focus on microprocessors and entered into a licensing agreement with Intel to produce compatible processors.

Throughout the 1990s and 2000s, AMD continued to expand its product offerings and gained a reputation for producing high-performance microprocessors that were competitive with those offered by Intel.

In 2003, AMD introduced its first processor using AMD64, a 64-bit version of the x86 instruction set, which was followed by the release of its first dual-core processor in 2005.

One of the critical features of AMD64 is its support for 64-bit memory addresses. This allows the processor to access more than 4 GB of memory, which was the limit for 32-bit processors. This is especially important for applications that require much memory, such as video editing or scientific simulations.

In 2006, AMD announced its intention to acquire ATI for $5.4 billion in a cash and stock deal. The acquisition was completed in October of that year, and ATI became a subsidiary of AMD.

The purchase allowed AMD to expand its product offerings and broaden its customer base, as it could now offer a full range of graphics and processing solutions. It also helped the company to better compete with its rivals and position itself as a leader in the tech industry.

Misguided Focus

AMD released its AMD FX series processors built on the Bulldozer microarchitecture in 2011. It marked a significant departure from the company's previous architectures and represented an ambitious attempt to increase performance and efficiency.

However, the Bulldozer microarchitecture faced criticism for its performance, particularly in single-threaded workloads. This was partly due to the shared resources within each module, which could lead to reduced performance when only one of the cores in a module was being heavily utilized.

This comes at a time when computer programs mainly were single-threaded – meaning they could not utilize AMD’s heavy multi-core approach in Bulldozer.

Additionally, the architecture needed help to keep up with Intel's competing processors regarding instructions per clock (IPC). Succeeding microarchitectures based on the Bulldozer microarchitecture increased IPC but could not compete with Intel’s processors, especially on a performance-per-watt metric.

Turning Point

2017 marked the release of the Zen microarchitecture, which was a significant release for AMD as this was the first time the company had produced a high-performance CPU architecture in over a decade.

While still below Intel’s IPC at the time, this has shifted the market in AMD’s favor, as AMD has been offering processors typically at a lower price for competitive performance. In addition, subsequent revisions of Zen further improved IPC, which achieved parity and even surpassed Intel’s.

With the release of the Zen and their Radeon line of GPUs, AMD has solidified its position in the gaming market, with its processors and graphics cards now often used in high-performance gaming PCs. In addition, the company has partnered with several major game developers to optimize its hardware for popular games.

In addition to its focus on technology products, AMD is committed to sustainability and corporate social responsibility. As a result, the company has implemented several initiatives to reduce its environmental impact and improve working conditions at its facilities.

Today, AMD is a leading global technology solutions provider with a diverse product portfolio and a strong presence in various markets. The company continues to innovate and push the boundaries of what is possible in microprocessors, graphics processing, and data center and enterprise solutions.

"AMD is beating Intel on all the metrics that matter, and until and unless Intel can fix its manufacturing, find some new way to manufacture things, they will continue to do that," said Jay Goldberg, semiconductor consultant at D2D Advisory in an interview with CNBC. 

The multinational semiconductor company now enjoys a 36.4% and 16% market share for desktop CPUs and GPUs. AMD chips now power NASA’s Mars Perseverance land rover, Tesla Model 3 and Y, 5G cell towers and the world’s fastest supercomputer, Frontier.