AMD licenses server processor technology to Chinese companies

(NASDAQ:AMD) is licensing the design of its state-of-the-art processor to a freshly formed Chinese organization, creating a fresh competitor for Intel Corporation (NASDAQ:INTC).

Share value in AMD stock is up more than 39 percent as of writing.

More importantly, "now there will be indigenous China-based x86 server designs", he said. The company posted $832 million in total revenues, which surpassed the Street's estimates of $818.6 million.

Operating loss: $68m (£47m), better than last year's $137m loss.

AMD has reported losses and declining revenues for several quarters.

AMD will get $293 million as part of the licensing agreement with Tianjin Haiguang Advanced Technology Investment Co., a joint venture overseen on the Chinese side by the Chinese Academy of Sciences. AMD will also receive royalties on the JV's chips. In other words, you can't touch this, Intel.

Advanced Micro Devices Inc (AMD) shares soared as much as 26 percent in early trading yesterday after it sold its licensing technology to a Chinese, state-backed joint venture that is to produce server processors for the Chinese market.

Also see: Will Zen save AMD, or might Apple? Judging from the conversation, it sounds as though this bundle includes x86 and ARM designs (AMD has a 64-bit ARMv8 server chip, Seattle) but the focus will be on x86. The deal infuses AMD with a significant pile of cash, just as the company is preparing to launch an array of new graphics processors based on its next-gen Polaris architecture, which will precede the first Zen-based desktop processors and APUs. In addition to this, AMD has a virtual monopoly in the Console GPU market, something that it has leveraged via its Graphics Core Next (GCN) architecture and Mantle & Vulcan APIs, which are key ingredients of Microsoft Corporation's (NASDAQ:MSFT) DirectX 12 push to streamline gamin g visual performance across consoles and PCs.

"No one's banking on AMD announcing blow out financial quarters anytime soon, in fact the question is whether Zen make it and this lays that to rest in a big way", said Brookwood. A 4K Sony PlayStation due to launch in the second half of 2016 is expected to use AMD CPU and GPU tech.

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