Microsoft said to debut AI chip next month in an effort to cut costs
Jean-Luc Ichard
Microsoft (NASDAQ:MSFT) is reportedly getting ready to unveil its first processor aimed at artificial intelligence workloads in an effort to cut costs.
The Redmond, Washington-based tech giant could unveil the chip at its annual developers' conference, The Information reported, citing a person with knowledge of the matter. The chip, which the company has worked on for years, could help reduce its reliance on Nvidia (NASDAQ:NVDA), which provides the vast majority of GPUs needed for AI work and to train large language models.
In August, UBS said that Microsoft being constrained by the number of GPUs it has access to is a "reality" and could impact their abilities to generate AI revenue streams next year. If it were to create its own GPUs, it could lessen that risk.
Microsoft, for its part, has publicly stated that it will continue to buy Nvidia GPUs.
The Microsoft processor is aimed at data center servers, as well as AI features in the company's productivity apps, the news outlet added. Small groups of employees, both from Microsoft and Microsoft-backed OpenAI, have also reportedly been testing the chips.
OpenAI, which took billions of dollars in backing from Microsoft earlier this year, is also reportedly discussing creating its own artificial intelligence chips and even evaluated a potential acquisition target.
Earlier this year, it was reported that Microsoft (MSFT) was working on the chip under the Project Athena codename, as well as working with AMD (NASDAQ:AMD) to further push its chips used for artificial intelligence workloads.
If Microsoft (MSFT) were to come out with its own AI chip, it would place it in the same ballpark as Amazon (AMZN) and Google (GOOG) (GOOGL), both of which have their own AI chips, the Inferentia and TPU, respectively.
Microsoft and Nvidia did not immediately respond to a request for comment from Seeking Alpha.

More on Advanced Micro Devices, Microsoft, etc.

Microsoft - Upgrading To Buy: A.I. Monetization Is Here
Microsoft's Copilot Product Solidifies Leading Competitive Position In Artificial Intelligence
Microsoft Stock: A Sell Despite Copilot AI Windows Integration
Nvidia, Marvell among those likely facing additional China export restrictions
Microsoft eyes closing Activision deal next Friday - report