AMD Abandons Dense Servers, Shuts Down SeaMicro To Refocus On Traditional Server CPUs


AMD has just announced that it will exit the dense server market effective immediately. This includes shutting down the SeaMicro business unit, which was spearheading microserver development.

SeaMicro was founded in 2007 and it specialized in designing dense servers otherwise known as micro servers. Dense servers differ from traditional enterprise servers in the type and quantity of the processors used. Dense servers rely on a significantly larger quantity of small, low power, highly efficient CPUs. In contrast to traditional enterprise which relies on larger, high performance focused machines. The idea behind it is that depending on the type of workload a dense server can be both less expensive to buy and to operate, through reduced power and cooling costs, compared to traditional servers.

AMD Abandons Dense Servers, Shuts Down SeaMicro To Refocus Research And Development On Traditional Server CPUs

AMD acquired SeaMicro for $334 million back in 2012 under the company's previous CEO Rory Read. It was seen as a chance to tackle the dense server market which was believed to be major future growth opportunity at the time. According to AMD's CEO Lisa Su's remarks in the latest earnings conference call AMD will no longer pursue this market. AMD will instead refocus its efforts to re-enter the high performance, traditional, enterprise and server markets. As part of this restructuring action, AMD has taken a $75 million special charge that is "primarily related to impairment of previously acquired intangible assets". AMD will maintain ownership of all SeaMicro intellectual property and will continue to use it in products where it's of benefit.

AMD pioneered the 64bit high performance server market with the original Opetron. The world's first 64bit processor and one of the company's most successful server product to date. Lisa Su remarked that AMD is very optimistic about the medium term financial success and growth in the server market that will be fueled by company's upcoming high performance x86 and ARM based products. While they were not mentioned by name, we're certain that Zen and K12 are being referred to here.

Zen and K12 are the company's upcoming high performance x86 and ARMv8 64bit sister cores. These will go into everything from server parts, to embedded solutions, semi-custom designs and client CPU and APU products.
SeaMicro wasn't as successful as AMD had hoped. Only launching one product under AMD since the acquisition in 2012. Sometimes the best way to go forward is to take a step back and look at how past successes were achieved. So perhaps shutting down an unsuccessful business unit and going back to its roots makes the most sense.