AMD Divests ZT Systems Manufacturing to Sanmina for $3 Billion

AMD Sells ZT Systems Manufacturing to Sanmina for $3 Billion

Semiconductor giant AMD has finalized the sale of ZT Systems' server manufacturing business to Sanmina, an electronics manufacturing services company. The deal, valued at $3 billion, comprises $2.25 billion in cash, a $300 million premium (50% cash, 50% equity), and a potential $450 million performance-based payment over three years.

The transaction, announced by AMD, is expected to close by the end of 2025, pending regulatory approvals. AMD will retain ZT Systems' rack-scale AI solutions design business.

Planned Divestiture Follows Acquisition

This sale aligns with AMD's previously stated strategy. When AMD acquired ZT Systems for $4.9 billion in August 2024, the company indicated its intent to divest the manufacturing portion of the business. The acquisition officially closed in March 2025.

Sanmina Becomes Preferred Manufacturing Partner

As part of the agreement, Sanmina will become AMD's preferred manufacturing partner for new product introductions related to cloud rack and cluster-scale AI solutions. This partnership aims to strengthen AMD's U.S.-based manufacturing capabilities and accelerate the delivery of high-quality AI systems to cloud customers.

“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 and accelerate quality and time-to-market for our cloud customers,” said Forrest Norrod, Executive Vice President and General Manager, Data Center Solutions Business Unit at AMD.

This strategic move allows AMD to focus on its core competency of designing cutting-edge AI solutions while leveraging Sanmina's manufacturing expertise.