AMD plans to buy networking company Pensando for $1.9 billion.

The company, which develops programmable packet processors, includes Goldman Sachs, IBM Cloud, Microsoft Azure, and Oracle Cloud among its customers.

Its processors and SmartNIC offering competes with AWS Nitro, Intel's DPU, and Nvidia's BlueField.

“To build a leading-edge data center with the best performance, security, flexibility and lowest total cost of ownership requires a wide range of compute engines,” said Dr. Lisa Su, AMD chair and CEO.

"Today, with our acquisition of Pensando, we add a leading distributed services platform to our high-performance CPU, GPU, FPGA and adaptive SoC portfolio. The Pensando team brings world-class expertise and a proven track record of innovation at the chip, software and platform level which expands our ability to offer leadership solutions for our cloud, enterprise and Edge customers.”

Pensando CEO Prem Jain added: “In less than five years Pensando has assembled a best-in-class engineering team that are experts in building systems together with a rich, deep ecosystem of partners and customers who have currently deployed over 100,000 Pensando platforms into production."

The company claims that its smart switching architecture has 100x the scale, 10x the performance at one-third the cost of ownership of any comparable products in the enterprise market. Girish Bablani, corporate vice president of Microsoft Azure, said: “We have seen a 40x improvement in overall cloud based connection related performance."

Jain and the Pensando team will join AMD's Data Center Solutions Group, led by AMD senior vice president and general manager Forrest Norrod.

AMD's acquisition offer is all in cash, and comes after its $35 billion Xilinx acquisition closed.

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