Arm Holdings (NASDAQ: ARM) and (NASDAQ: AMD) represent two different ways to invest in the booming demand for artificial intelligence (AI) chips. Arm doesn't produce any chips of its own; it only designs central processing units (CPUs) and licenses its designs to chipmakers including Qualcomm and Apple. It's been rolling out new AI-oriented chip designs for phones, servers, and vehicles.

AMD produces x86 CPUs, discrete graphics processing units (GPUs), custom accelerated processing (which combine CPUs and GPUs), and programmable chips. It outsources the production of those chips to third-party foundries such as Taiwan Semiconductor. It's also been carving out a niche in the data center market with its Epyc server CPUs and Instinct GPUs for processing AI applications.

Image source: Getty Images.

Continue reading

Source Fool.com