Advanced Micro Devices (NASDAQ:AMD) recently launched its EPYC server processors for data centers. The processors outperform Intel's (NASDAQ:INTC) current generation of processors and are supported by partners across the product ecosystem. Operating system providers are showing a strong support for optimization. Server space players also are showing a strong interest in EPYC because of process technology support and dense server capabilities. This launch gives industry players an opportunity to end Intel's command in the server market. Following are some of the reasons why we believe AMD will hurt Intel in the server space.
Performance and memory bandwidth
In 2-Sockets, EPYC has higher performance, ranging from 23% to 70%, across all price entry points. In 1S configuration, Advanced Micro Devices displayed a boost in a range of 21-63%.
Regarding memory bandwidth, Intel's current offerings lag behind Advanced Micro Devices' equivalent. The AMD EPYC 7601 system on chip (SoC) beats Intel Xeon processor E5-2690 v4 CPU in memory bandwidth by 146% on 2P servers.
Performance per watt
EPYC is looking at a performance per watt gain of 1.54x for integer performance and 1.76x for floating point performance. Now, as its performance per watt is lower as compared to Intel's current best-in-class 2P E5-2699A v4, material TCO gains will be a selling point for EPYC.
Reduced total cost of ownership
EPYC allows data centers to fit more severs in a relatively smaller space, which can have a material impact on TCO. AMD claims that 1-Socket scalable capabilities of the processor can result in 20% capex savings for data center clients. Note that EPYC eliminates the need for additional motherboards for scaling I/O and memory.
Another key thing to note here is the ecosystem. Server markets are driven by support ecosystem. It was always a concern whether Advanced Micro Devices could build a decent ecosystem for its EPYC offerings. The company has done well, given the fact that partners across industries are on board. Its partners include server OEMs, ODMs and cloud infrastructure providers. Optimization support from server operating system providers is also a success for AMD.
Incentive for price competition
Players in the server market have a very strong incentive to initiate price competition. This was not possible before, given Intel's superior performance fueled by the node lead. The launch of EPYC has changed that, as AMD demonstrated superior performance.
Leapfrogging process technology
Enterprise clients, including public cloud providers, have a decision to make. They can either go with Purley, which is launching soon, or they can opt for 14nm EPYC parts. Going with EPYC can allow clients to leapfrog process technology later to jump onto 7nm. Note that AMD's next-generation products are expected to be based on GlobalFoundries' 7nm process technology. This is the primary reason Intel doesn't hold a clear advantage with its 10nm launch.
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I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it. I have no business relationship with any company whose stock is mentioned in this article.