It has been working on Seattle, their first ARM product, and it will continue working on ARM in 2016, along with new K12 processors. When asked, AMD said that Seattle has been sampling for a while and that the ARM in server is a long-term play for the company.
The company was a major market player in the server market a few years back, but after the not-so-successful K10 Barcelona launch, it was hard for AMD to recover and claw back market share from Intel.
AMD will have a new core in 2016, and it plans to lean on its experience, as well as its server business strategies that worked in the past in order to win as much of that market as possible. One can see AMD servers as potentially better price / performance ratio compared to Intel Xeons. We expect that many AMD server customers will want to experiment with Seattle 64-bit ARM core and that this can be a good play for the company.
With mobile phones and tablets being a dominant platform as well as bushel of other internet connected devices server market can only grow. If you add online storage (Dropbox, One Drive, Google Drive) as well as Nextfix, Spotify, iTunes, Samsung Keys our best guess is that we will need more servers in the near future.
Servers are also higher margin products than consumer products.
In a recent conference call, AMD’s SVP and CFO Devinder Kumar said:
“It's a longer-term play. We think it gets there and maybe if you ask me right now in the 2019 timeframe, I say 15% of the overall server space is in the ARM server business. When you get transitional space, AMD's market share today is like 2% or 3%, nothing to really talk about.”
AMD hopes that fifteen percent of the server business might be powered by ARM server products. This is a huge play for AMD as the server market is estimated at $14 billion a year. That 15 percent translates to $2.1bn for ARM powered server processors in 2019, but these numbers are projections and 2019 is a long way off. A lot of things can change in four years.
AMD also said that it is working very hard with its server customers on the introduction on a new server core in 2016. The company announced that K12 is coming in that timeframe and, in other words, AMD won’t have much to offer trough in 2015, at least in not in the server market. Carrizo could be a nice play for the notebook segment in 2015 but it’s not in servers.