AMD has announced that it will build custom x86 enterprise CPUs for the Chinese government, providing finished solutions as well as licensing IP. The comany will team up with Tianjin Haiguang Advanced Technology Investment Co., Ltd, which is the investment arm of the Chinese Academy of Sciences. AMD is getting $293 million from the licensing agreement, and stands to make more over the year through royalties.
Under the terms of the joint venture, AMD will be working with THATIC over SoCs, as well as multi-socket CPUs that will primarily be used in data centers and servers. AMD’s GPU and ARM IP is not included in the deal.
The venture is geared to provide the Chinese government with custom hardware that can be tweaked to its liking. AMD also wins as it is tweaking currently-existing hardware — all indications suggest it will be the Zen platform that will be leveraged — to tailor the custom CPUs, and as such it won’t have to invest significant resources for the project. The move also boosts the vendor;’s cash reserves, and the royalty agreement will ensure cash flow after the licensing fee runs out.