Chipmaker AMD has announced the signing of an agreement to acquire ZT Systems, a leading provider of AI infrastructure for hyperscale computing companies, for $4.9 billion (£3.7bn~).

The move, which can be seen as a challenge to Nvidia’s AI infrastructure, is the latest in a series of efforts to strengthen AMD’s AI capabilities—with over $1 billion being spent to expand AMD’s AI ecosystem within the last year alone.

Headquartered in Secaucus, New Jersey, ZT Systems has more than 15 years of experience in designing and deploying data centre AI compute and storage infrastructure at scale for large global cloud companies.

ZT Systems’ design, integration, manufacturing, and deployment capabilities have made them one of the leading providers of AI training and inference infrastructure.

“Our acquisition of ZT Systems is the next major step in our long-term AI strategy to deliver leadership training and inferencing solutions that can be rapidly deployed at scale across cloud and enterprise customers,” said Dr. Lisa Su, AMD chair and CEO.

“ZT adds world-class systems design and rack-scale solutions expertise that will significantly strengthen our data center AI systems and customer enablement capabilities. This acquisition also builds on the investments we have made to accelerate our AI hardware and software roadmaps.

“Combining our high-performance Instinct AI accelerator, EPYC CPU, and networking product portfolios with ZT Systems’ industry-leading data center systems expertise will enable AMD to deliver end-to-end data center AI infrastructure at scale with our ecosystem of OEM and ODM partners.”

AMD has agreed to acquire the firm in a cash and stock transaction valued at $4.9 billion (£3.7bn~). The deal is expected to close in the first half of 2025, subject to certain regulatory approvals and other customary closing conditions.

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Frank Zhang, CEO of ZT Systems, also commented: “We are excited to join AMD and together play an even larger role designing the AI infrastructure that is defining the future of computing.”

“For almost 30 years we have evolved our business to become a leading provider of critical computing and storage infrastructure for the world’s largest cloud companies.

“AMD shares our vision for the important role our technology and our people play designing and building the computing infrastructure powering the largest data centers in the world.”