AMD is selling ZT Systems’ server-manufacturing business to Sanmina in a deal worth $3 billion. The move is part of AMD’s plan to double down on AI systems while handing off large-scale hardware production.
The deal includes $2.25 billion in cash. AMD will also receive a $300 million premium—half in cash, half in Sanmina stock. An additional $450 million will be paid later, depending on financial performance over the next three years. The transaction is expected to close by the end of 2025, pending regulatory approval.
This decision didn’t come out of the blue. Back in August 2024, AMD announced its $4.9 billion acquisition of ZT Systems. At the time, the company made it clear that it would eventually sell off ZT’s server production arm. That acquisition officially closed in March 2025.
Following the divestiture, AMD will retain full control of ZT’s rack-scale AI systems design business. This business focuses on creating high-performance infrastructure for cloud and AI workloads—something AMD considers essential to its long-term growth.
Sanmina, a well-known electronic manufacturing services firm, will now take over the server production side. At the same time, AMD has named Sanmina as its preferred manufacturing partner for launching new cloud rack and AI cluster products.
Forrest Norrod, executive vice president of AMD’s data center division, said the partnership is aimed at speeding up delivery and improving quality. By combining AMD’s AI design expertise with Sanmina’s manufacturing power, the company expects to enhance its U.S.-based production and meet growing demand from cloud providers.
The move fits into a larger strategy. AMD is focusing more on AI design and performance while outsourcing the hardware heavy lifting. With rivals racing to deliver AI-ready infrastructure, this streamlined model could give AMD a sharper competitive edge.
