AMD Sells ZT Systems’ Server-Manufacturing Business to Sanmina for $3 Billion

AMD has finalized a significant transaction to divest ZT Systems' server-manufacturing business, a move that aligns with its strategic plans since the initial acquisition in 2024. On Monday, the semiconductor giant announced that it would be selling this business to Sanmina, a leading electronic manufacturing services company, for a total of $3 billion. The deal is structured with $2.25 billion in cash, a $300 million premium split equally between cash and equity, and an additional $450 million contingent payment tied to financial performance over the next three years. The transaction is expected to conclude by the end of 2025, pending regulatory approvals. Following this divestiture, AMD will retain control of ZT Systems' rack-scale AI solutions design business, which is crucial for the company’s long-term strategy in artificial intelligence and cloud infrastructure. When AMD first announced its acquisition of ZT Systems, an AI and cloud infrastructure company, in August 2024, it had already outlined plans to divest the server-manufacturing segment after the deal's closure. The acquisition was officially completed in March 2025, setting the stage for this latest move. In conjunction with the sale, AMD has named Sanmina as its preferred new product introduction (NPI) manufacturing partner for cloud rack and cluster-scale AI solutions. This partnership aims to bolster AMD's U.S.-based manufacturing capabilities and enhance the quality and speed at which it brings products to market, particularly for its cloud customers. Forrest Norrod, AMD’s Executive Vice President and General Manager of the Data Center Solutions Business Unit, commented on the decision. "By combining the deep experience of our AI systems design team with our new preferred NPI partnership with Sanmina, we expect to strengthen our U.S.-based manufacturing capabilities for rack and cluster-scale AI systems, accelerating quality and time-to-market for our cloud customers," Norrod stated. The strategic divestiture allows AMD to focus more intently on its core competencies while leveraging Sanmina's expertise in manufacturing. This arrangement is likely to streamline operations and enable AMD to deliver advanced AI and cloud solutions more efficiently, ultimately enhancing its competitive position in the rapidly evolving tech landscape. TechCrunch has reached out to AMD for further comment on the deal and its implications.