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Intel and Facebook Team Up to Build an AI Chip

By Ashraf Eassa – Updated Apr 17, 2019 at 11:39PM

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In case you've been living under a rock, artificial intelligence (AI) has become one of the biggest buzz phrases in technology. Unsurprisingly, then, many computer-chip companies have been rushing to build chips that can quickly and efficiently handle artificial-intelligence workloads. 

One of those companies is chip giant Intel (INTC -2.79%).

Intel's Navin Shenoy on stage holding a CPU.

Image source: Intel.

At CES 2019, Intel talked up a new chip that it's building, called the Neural Network Processor for Inference, or NNP-I for short. According to the company, "[This] new class of chip is dedicated to accelerating inference for companies with high workload demands and is expected to go into production this year."

A little while back, Intel said that it expected the total market for AI-oriented chips to grow from around $2.5 billion to between $8 billion and $10 billion by 2022. If those growth projections are even close to correct, it's clear that there's a significant opportunity here for the chip giant.

Let's take a closer look at what Intel has disclosed about the NNP-I and one thing, in particular, that could help the product (and its successors) be commercially successful. 

Intel's getting help from a potential customer

Generally speaking, it's a good idea for companies to build products that others want to buy. A good way to make that happen is to work closely with potential buyers of those products to build them. That's what Intel seems to be doing with the NNP-I. 

According to Intel, one of its development partners for the NNP-I is social-media giant Facebook (META -4.27%). Facebook is a major buyer of Intel's Xeon server chips today and, in general, makes massive investments in its infrastructure. Indeed, Facebook is set to plunk down between $14 billion and $14.5 billion on capital expenditure (capex) in 2018, with that figure set to grow to between $18 billion and $20 billion by 2019

A big part of that capex is spent on data-center servers -- servers that tend to have a significant amount of Intel processor content inside.

While having Facebook as a development partner doesn't guarantee that the NNP-I will be a commercial success, I'd imagine that it does improve the odds that Intel will build a compelling product and have a pipeline of good stuff in the works, too.

What do we know about the NNP-I?

Intel hasn't disclosed that much about the NNP-I, but what's interesting to note is that, in a tweet post-CES, the head of Intel's artificial intelligence products group, Naveen Rao, disclosed some key technical details of this product. You can see the tweet below:

The chip apparently will be manufactured by Intel using its in-house 10nm manufacturing technology. It'll also apparently embed the company's next-generation Sunny Cove CPU cores. (These new cores promise significant performance improvements over the current-generation stuff and also incorporate some AI-specific machinery.)

Given that CPUs tend to be pretty good for artificial intelligence inference workloads, it makes sense for Intel to leverage its CPU technology to build a more specialized accelerator product.

Investor takeaway

If Intel can build a compelling AI inference accelerator with the NNP-I and consistently deliver improved versions of the product at a rapid clip, it could help the chip giant better capitalize on the market for artificial intelligence chips, potentially boosting the revenue and profits of its data-center group (DCG) compared to what they might be without this product line.

Check out the latest Intel earnings call transcript.

Ashraf Eassa has no position in any of the stocks mentioned. The Motley Fool owns shares of and recommends Facebook. The Motley Fool has a disclosure policy.

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