AMD has announced that it will lay off 4% of its workforce, or about 1,000 employees. The company’s actions are explained by the large “growth opportunities” in the artificial intelligence chip industry, which is dominated by NVIDIA. This was reported by CNBC.

″As a part of aligning our resources with our largest growth opportunities, we are taking a number of targeted steps that will unfortunately result in reducing our global workforce by approximately 4%. We are committed to treating impacted employees with respect and helping them through this transition,” said an AMD spokesperson.

The company is the second largest manufacturer of chips for artificial intelligence after NVIDIA. Over the last quarter, AMD’s revenue in this area doubled. Analysts predict that AI chip revenues will grow by 98% by the end of 2024.

Despite significant success in the industry, AMD shares fell by 5% in 2024. At the same time, the value of NVIDIA shares increased by 200% in 2024. It has become the most expensive in the world several times and even became the first to pass the $3.6 trillion mark in market capitalization.

Despite the fact that AMD MI300X chips are in demand and companies such as Meta and Microsoft are buying them as an alternative, NVIDIA still has a significant lead in the market, with an 80% share. The gap is due to the fact that NVIDIA, among other things, offers key software that AI engineers use to develop programs like ChatGPT.