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AMD to acquire Europe's top private AI lab Silo AI for $665 million

EditorNatashya Angelica
Published 07/10/2024, 11:03 AM

SANTA CLARA, Calif. - Advanced Micro Devices Inc. (NASDAQ: NASDAQ:AMD) announced today it has entered into a definitive agreement to purchase Silo AI, Europe's largest private artificial intelligence laboratory, for approximately $665 million in cash. This strategic acquisition is set to bolster AMD's AI capabilities and enhance its open-source software for efficient AI model training and inference on its computing platforms.

Silo AI, headquartered in Helsinki, Finland, is recognized for its expertise in creating tailored AI solutions across various industries, with notable clients such as Allianz (ETR:ALVG), Philips, Rolls-Royce (OTC:RYCEY), and Unilever (LON:ULVR). Its CEO and co-founder, Peter Sarlin, will continue to head the Silo AI team within AMD's Artificial Intelligence Group, reporting to senior vice president Vamsi Boppana.

The transaction is expected to close in the latter half of 2024 and marks another step in AMD's strategy to deliver comprehensive AI solutions in collaboration with the global AI ecosystem. The acquisition aims to leverage Silo AI's experience in developing AI models and software solutions, including advanced large language models (LLMs) on AMD platforms.

AMD's Boppana expressed optimism about the acquisition, noting Silo AI's team of AI experts and their proven track record in developing leading AI models and solutions. He anticipates that this partnership will accelerate AMD's AI strategy and facilitate the rapid implementation of AI solutions for customers worldwide.

Silo AI has also made significant strides in scaling LLM training on LUMI, Europe's fastest supercomputer, which is powered by over 12,000 AMD Instinct MI250X GPUs. In collaboration with university partners, Silo AI has developed open-source models for EU languages, contributing to the advancement of AI technology.

The acquisition is part of AMD's broader investment in AI, with the company having invested over $125 million in a dozen AI companies in the past year and acquiring Mipsology and Nod.ai to expand its AI ecosystem.

The information in this article is based on a press release statement from AMD.

In other recent news, Advanced Micro Devices (AMD) has experienced significant changes in its financial outlook and executive compensation. KeyBanc adjusted AMD's share price target to $220 from $230, maintaining an Overweight rating despite acknowledging mixed prospects for the company.

This adjustment is influenced by sustained demand for AMD's 500K MI300X GPUs and expected growth in traditional server demand, counterbalanced by weaker demand for Embedded products and ongoing inventory destocking.

In addition, AMD has approved salary increases and long-term incentive awards for several top executives, including CEO Lisa T. Su and Executive Vice President Jean Hu. These changes are part of AMD's 2023 Equity Incentive Plan aiming to align executive interests with those of shareholders.

The company's stock has been the subject of strategic portfolio adjustments by Cathie Wood's ARK ETF, which purchased a significant number of AMD shares. Analyst ratings for AMD have been varied, with Susquehanna maintaining a positive rating and Stifel reaffirming a Buy rating, while Morgan Stanley downgraded the stock. These are recent developments that investors may want to consider.

InvestingPro Insights

Advanced Micro Devices Inc. (AMD) has been making headlines with its latest strategic move to acquire Silo AI, which is expected to significantly enhance its AI capabilities. As investors and industry-watchers evaluate this development, it's worth considering some real-time data and insights provided by InvestingPro.

InvestingPro Data shows that AMD has a market capitalization of $286.25 billion, reflecting its significant presence in the semiconductor industry. The company's Price/Earnings (P/E) ratio stands at a high 256.09 as of the last twelve months, indicating a premium market valuation compared to earnings. Moreover, AMD has demonstrated a robust revenue growth of 2.24% in the first quarter of 2024, showcasing its ability to increase sales amidst a competitive landscape.

InvestingPro Tips highlight that AMD is expected to see net income growth this year, which could be a promising sign for investors looking for growth prospects. Moreover, the company has seen a significant return over the last week, with a price total return of 8.05%, reflecting positive investor sentiment and market performance.

These metrics can be particularly relevant for those considering AMD's stock, especially in light of the company's recent acquisition moves and its aim to become a more formidable player in the AI space.

For those interested in a deeper dive into AMD's financials and strategic positioning, there are additional InvestingPro Tips available, which can be accessed on the InvestingPro platform. These include insights on AMD's volatility, liquidity, and debt levels, among others. To explore these further, investors can use the coupon code PRONEWS24 to get up to 10% off a yearly Pro and a yearly or biyearly Pro+ subscription, unlocking a wealth of analysis and data to inform their investment decisions.

This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.

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