Gaudi AI chips, which Intel launched with great hopes, were overshadowed by Nvidia and AMD. Intel, which targets $500 million in revenue from Gaudi AI chips for 2024, announced that it will not be able to achieve this target. While Nvidia is taking giant steps in the field of artificial intelligence and earning tens of billions of dollars; AMD experienced the fastest product growth in its history, generating $1 billion in revenue in one quarter with its AI chips. But none of this applies to Intel.Intel couldn’t find what it was looking for in AI chips
The company claimed that it would earn $1 billion or even $2 billion in 2024 thanks to artificial intelligence. But it won’t be possible to reach even the much more modest goal of $500 million for the Gaudi AI accelerator this year. “We will not meet our $500 million revenue target for Gaudi in 2024,” CEO Pat Gelsinger said on the company’s Q3 2024 earnings call.
Gelsinger emphasized that the product transition process and software ease of use experienced in the transition from Gaudi 2 to Gaudi 3 affected these low adoption rates. The Gaudi 3 accelerator was launched last quarter. Nevertheless, Gelsinger stated that they are positive that they will be able to find a place for themselves in this market in the future. “There is a clear need for solutions that deliver better total cost of ownership based on open standards, and we continue to evolve Gaudi’s value proposition,” he added.
Restructuring challenges the company
Gelsinger criticized the concentrated use of AI chips in the cloud and pointed out that in the long run, it may be more important for artificial intelligence to be included in all chips, not just cloud-based models.
Intel announced revenue of $13.3 billion in the third quarter of 2024, down 6 percent year-on-year. However, the company incurred a loss of $16.6 billion, including restructuring costs. These losses show the impact of the cost-cutting decisions the company took to achieve a more profitable structure in the future. Intel announced a $10 billion cost-cutting plan last quarter and initiated more than 15,000 layoffs.
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