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Intel is effectively killing Falcon Shores, its next-generation GPU for high-performance computing and AI workloads.<\/p>\n The move comes as Intel tries to correct course after a number of disappointing product launches and historic losses<\/a>, while competitors like AMD and Nvidia gain ground.<\/p>\n Intel co-CEO Michelle Johnston Holthaus said during the company\u2019s fourth-quarter earnings call Thursday that Intel will \u201cleverage Falcon Shores as an internal test chip, without bringing it to market.\u201d<\/p>\n \u201cAI data center\u00a0\u2026 is an attractive market for us,\u201d Holthaus said during the call. \u201c[B]ut I am not happy with where we are today. We\u2019re not yet participating in the cloud-based AI data center market in a meaningful way\u00a0\u2026 One of the immediate actions I have taken is to simplify our roadmap and concentrate our resources.\u201d<\/p>\n The focus instead will be on Jaguar Shores, which Holthaus called Intel\u2019s opportunity to \u201cdevelop a system-level solution at rack scale\u00a0\u2026 to address the AI data center more broadly.\u201d<\/p>\n Holthaus tempered expectations<\/a> for Falcon Shores last month, when she implied that it was an \u201citerative\u201d step over the company\u2019s previous dedicated AI data center chip, Gaudi 3.<\/p>\n \u201cOne of the things that we\u2019ve learned from Gaudi is, it\u2019s not enough to just deliver the silicon,\u201d Holthaus said during Thursday\u2019s earnings call. \u201cFalcon Shores will help us in that process of working on the system, networking, memory \u2014 all those component[s]. But what customers really want is that full-scale rack solution, and so we\u2019re able to get to that with Jaguar Shores.\u201d<\/p>\n Gaudi 3 is widely seen as a miss for Intel. In November, the company said it would be unable to meet its goal of $500 million in Gaudi 3 sales due to software-related issues. Today, few major service providers beyond IBM<\/a> have committed to using the chip.<\/p>\n Intel faces an uphill battle in the AI data center chip space. Rival AMD expects to make around $7 billion<\/a> in AI chip revenue in 2025, while Nvidia, the incumbent to beat, could hit $195 billion in revenue in fiscal 2026, according to some analysts<\/a>.<\/p>\n \u201cAs I think about our AI opportunity, my focus is on the problems our customers are trying to solve, most notably the need to lower the cost and increase the efficiency of compute,\u201d Holthaus said. \u201cAs such, a one-size-fits-all approach will not work, and I can see clear opportunities to leverage our core assets in new ways to drive the most compelling total cost of ownership across the continuum.\u201d<\/p>\n<\/div>\n