Nvidia's Growing Server CPU Business Poses Challenge for AMD and Intel
Nvidia has quietly expanded its server CPU business, signaling a potential shift in market dynamics that could challenge long-standing leaders AMD and Intel. In Q2 fiscal 2027, Nvidia reported $96.2 billion in revenue with data center sales reaching $89 billion—up significantly year-over-year. Within this growth was the Grace CPU segment, which generated over $5 billion in trailing twelve-month revenue. The company is now pushing its Vera CPUs as standalone products and expects server CPU demand to reach $20 billion for fiscal 2027. Nvidia's strategy involves integrating these CPUs into broader platforms like Rubin, reducing reliance on x86 chips from AMD and Intel. This approach allows Nvidia to bypass direct competition in traditional CPU specs while leveraging its AI infrastructure expertise. Analysts were initially skeptical of the $20 billion forecast but confirmed large-volume potential through customer checks. AMD's data center segment revenue rose 107% year-over-year, with server CPU market share at 34.5%, up from previous quarters. Intel’s data center and AI segment also saw a 59% increase in sales to $6.3 billion.
Topics: AI chips AMD Intel market competition Nvidia server CPUs