Intel's New CEO Vows to Compete with Nvidia's Best AI Server — Barrons.com
Intel's new CEO, Lip-Bu Tan, aims to enhance the company's position in the AI hardware market, specifically targeting competition with Nvidia's leading AI server systems. In his annual report, Tan emphasized the need for competitive rack-scale solutions in cloud-based AI data centers. Despite a recent 1.8% drop in Intel's stock, Tan is optimistic about revitalizing Intel's AI business, which has struggled against Nvidia's dominance. The company previously missed revenue forecasts and shifted focus from its Gaudi-AI accelerators to a new solution, Jaguar Shores.
By Tae Kim
Intel's new Chief Executive Lip-Bu Tan has a message for investors: We will compete with Nvidia in AI hardware.
"There's no question we need to strengthen our position in the cloud-based Al data center market by developing competitive rack-scale system solutions, which will be a key priority for me and the team," Tan wrote in Intel's annual report, which was filed on Thursday.
Earlier this month, Tan was named the permanent CEO of Intel. He succeeds former CEO Pat Gelsinger, who retired in December.
On Thursday, Intel stock was down 1.8% to $23.01.
The new Intel executive was referring to competing with Nvidia's top-of-line GB200 NVL72 Blackwell AI system, which a former Intel executive called the current "apex predator" in AI computing. It has 72 GPUs linked together inside one server rack versus the previous server's eight GPUs, offering unprecedented computing-power density in a small space.
Nvidia dominates the market for AI data-center hardware.
In contrast, Intel's AI products have not done well. Last October, the company admitted its Gaudi-AI accelerators wouldn't achieve its prior $500 million revenue forecast for 2024. In January, Intel announced it wouldn't bring its next AI data center product Falcon Shores to market and would instead focus its efforts on developing another AI data-center solution called Jaguar Shores.
Tan is hoping that under his leadership, Intel's AI business can get back on track.
Write to Tae Kim at tae.kim@barrons.com
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