Intel Introduces Gaudi 3 AI Chips to Compete with Nvidia

• Intel has launched Gaudi 3 - its latest AI chip that will compete with Nvidia's H100
• Gaudi 3 is claimed to be twice as efficient as the H100 and 70% quicker
• Intel is expected to face tough competition from Nvidia's Blackwell series of GPUs

Intel has launched a new AI chip called the Gaudi 3. The chip allows AI developers to not only test various AI models but also run the final product.

As compared to Gaudi 2, the latest version sees various advancements:

• 2x the AI compute performance when using the 8-bit floating point (FP8) format
• 4x the performance when using the 16-bit BFLOAT16 format
• 1.5x the memory bandwidth
• 2x the network bandwidth

Intel claims that Gaudi 3 is twice as efficient as Nvidia's H100 and helps in training AI models 1.7 times more quickly. The chips will be available from the third quarter of 2024.

Intel is also very close to securing a $10 billion subsidy from the Biden government under the newly launched CHIPS Act. The act aims to provide financial assistance to semiconductor manufacturers and supply chain participants to boost the production of chips.

Intel Gaudi 3 stands out as the GenAI alternative presenting a compelling combination of price performance, system scalability, and time-to-value advantage.Justin Hotard, Intel executive vice presidentGaudi 3's Nvidia Challenge

Although Intel's Gaudi 3 is more powerful and efficient than H100, Nvidia has already moved ahead in its semiconductor journey.

Nvidia has recently launched the Blackwell chip, which is 30 times faster than H100 (its predecessor) and consumes 25 times less power. It allows tech firms to run real-time generative AI on trillion-parameter large language models.

Although Intel has compared its latest chip to the H100, its real competition might just well be with the Nvidia Blackwell series of chips, which are far more superior.

However, one aspect where Intel can beat Nvidia is pricing. Blackwell chips will reportedly be priced between $30,000 and $40,000, which is four times more than AMD's competing MI300X. Although the pricing of Gaudi 3 hasn't yet been revealed, if Intel manages to price it below $30,000, it can give it a pricing edge in the market.

Nvidia's focus on its H100 series of chips yielded some exceptional financial results. The company saw a whopping 580% increase in its profit in 2023 as compared to the last year, thanks to its 80% share in the semiconductor market.

Its share prices also increased by more than three times during the same period, making it one of the most valued companies in the US.

The Increasing Demand for AI Chips

The shortage of AI chips is a major bottleneck in the development of AI. OpenAI CEO, Sam Altman, is working on a $7 trillion project to produce high-quality AI chips. Similarly, SoftBank CEO, Masayoshi Son, is also raising $100 billion for his ambitious AI project named Izanagi.

Altman has also advocated the use of alternative sources of energy and is working on the Polaris project in partnership with Helium Energy. The project aims to build the world's first nuclear fusion power plant - a source of energy Sam plans to use for AI development.

The AI chips market was valued at around $53.5 billion in 2023 and is expected to grow by a whopping 30% in 2024 to reach $67 billion.

This demand is expected to swell more in the upcoming decade. This indicates a massive opportunity for Intel-and its Gaudi 3 seems to be the right step towards seizing that opportunity.

Read more: AI to boost copper demand by 1 million tons per annum by 2030

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