AMD's CES AI Push Shows How It Plans to Compete at Scale. Here's Why It Matters.

If there was any doubt that Advanced Micro Devices (NASDAQ: AMD) was serious about serving the artificial intelligence (AI) data center market, it was wiped away on Monday at the 2026 CES gathering in Las Vegas.

That's the undeniable takeaway from CEO Lisa Su's opening keynote speech, anyway. While the company featured new consumer-oriented technologies like gaming-friendly graphics cards and personal computer processors, AI took center stage -- figuratively and literally. For instance, AMD's new Ryzen AI Halo processor puts the power of artificial intelligence into individuals' local devices rather than forcing them to rely on remote access to a cloud platform.

Image source: Getty Images.

The proverbial show-stopper, however, was the sheer number of large-scale solutions that Advanced Micro Devices unveiled, like its "Helios" rack-scale platform. Powered by its Instinct MI455X accelerators, Helios is the "blueprint for yotta-scale infrastructure, delivering up to 3 AI exaflops of performance in a single rack." (For reference, 1 exaflop is 1 quintillion operations per second -- a 1 followed by 18 zeros -- while one yotta is 1 septillion -- a 1 followed by 24 zeros -- operations per second. AMD says the computing capacity of the entire AI industry today is nearly 100 zettaflops, or 100,000 exaflops.)

In other words, Advanced Micro Devices clearly intends to become a serious competitor to Nvidia, which currently dominates the artificial intelligence computing space.

Of course, none of this should come as a surprise to any investor who's been keeping close tabs on the company since November. That's when AMD first unveiled its strategy to better penetrate the $1 trillion AI industry, leveraging the aforementioned Helios systems built around the also aforementioned Instinct MI450 Series GPUs (graphics processing units). That's also when it publicly committed to a growth target for its artificial intelligence arm as well as for the entire company. Although it didn't offer a specific time frame other than to call these "long-term" targets, AMD is aiming for 80% annualized growth from its AI data center hardware business, setting the stage for annualized companywide growth of 35%.

Perhaps more important to interested investors, the company can likely hit these impressive targets. During the third fiscal quarter ending in September last year, AMD's data center business grew 22% year over year, and that was without the help of its new Helios platform and the underlying MI455X accelerators. Rather, the company's fifth-generation AMD Epyc server processors and its AI-capable Instinct MI350 series GPUs -- which would soon be topped by newer tech -- did most of that heavy lifting. This early growth driven by lesser technology underscores the growing demand for large-scale artificial intelligence solutions as well as Advanced Micro Devices' ability to meet it.

James Brumley has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Advanced Micro Devices and Nvidia. The Motley Fool has a disclosure policy.