As Nvidia Dominates AI Landscape, Intel's 2024 'Sierra Forest' Gears Up for Data Center Revolution

Intel Corp INTC eyes a next-generation data center chip. Likely for a 2024 launch, this chip promises to provide over double the computational capability for each unit of power consumed amid global efforts to reduce energy consumption. 

Intel showcased its latest innovation during a semiconductor conference at Stanford University in Silicon Valley.

The anticipated "Sierra Forest" chip from Intel will likely present an impressive 240% enhancement in performance per watt when juxtaposed with its current data center counterpart, Reuters reports.

Last week, Nvidia Corp's NVDA quarterly report indicated that the artificial intelligence frenzy is here to stay.

Intel looks to tap the surging chip demand triggered by the AI frenzy involving tech giants, including Apple Inc AAPL, Google parent Alphabet Inc GOOG GOOGL Meta Platforms Inc META, Amazon.Com Inc AMZN, Microsoft Corp's MSFT.

The global data center chip industry generated $11.7 billion in 2022 and will likely reach $45.3 billion by 2032, registering a CAGR of 14.6% from 2023 to 2032. 

Data centers, the backbone of the online world, are notorious for their hefty power consumption. Consequently, there's mounting pressure on tech giants to maintain or scale down their energy usage, spurring chip manufacturers to innovate and extract more processing juice from each chip.

Ampere Computing, an ambitious startup initiated by former Intel higher-ups, pioneered launching an energy-efficient chip tailored for cloud computing tasks. 

Industry leaders Intel and Advanced Micro Devices, Inc AMD haven't been far behind, with AMD launching its contender this June. Intel's announcement on Monday reaffirmed that its "Sierra Forest" chip remains on course for a launch next year.

Furthermore, Intel is diversifying its data center chips into two distinct segments. 

While high on performance, the "Granite Rapids" version will be more power-hungry, in contrast to the energy-conserving "Sierra Forest" variant.

Ronak Singhal, a distinguished senior fellow at Intel, highlighted that customers can seamlessly consolidate legacy software onto fewer servers, enabling enhanced power savings with the upcoming chips. 

"I can get power savings by moving something that's currently on five, 10, or 15 different servers into a single new chip," explained Singhal. 

This approach will increase the density of operations and curtail system costs for clients.

Price Action: INTC shares traded lower by 0.51% at $33.44 premarket on the last check Tuesday.

Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.