Ampere Computing, a datacenter CPU designer backed by Oracle, is exploring a potential sale due to growing competition and uncertain prospects for an initial public offering (IPO). The company has enlisted a financial adviser to weigh its strategic options, including a possible buyout.

This move suggests Ampere may not see a clear path to an IPO in the current environment, facing increased competition from AMD, Intel, and Arm, despite rising demand for AI-driven machines. While an IPO is not imminent, the company remains open to the possibility in the future, per Bloomberg's report.

Founded in 2018 by former Intel executive Renee James, Ampere focuses on developing multi-core Arm-based processors for cloud datacenters, with customers like Oracle, AWS, Microsoft, and Google. Oracle, which has made significant investments in the company, is its primary financial and strategic backer. James also serves on Oracle's board of directors.

Ampere has launched a range of processors, including the Ampere Altra and Altra Max CPUs with up to 128 cores in 2020, AmpereOne processors with up to 192 cores in 2023, and is planning to release a 256-core version in 2024. These chips, excluding the 256-core model, have been adopted by Oracle for its Oracle Cloud Infrastructure (OCI), with other cloud providers like Google and Microsoft also utilizing them. Ampere is further planning to introduce a 512-core AmpereOne Aurora CPU.

However, the recent advancements in AMD's 192-core and Intel's 244-core x86 processors have dimmed the outlook for Ampere's Arm-based CPUs in the competitive datacenter market. Still, Ampere remains optimistic about its long-term future, believing its energy-efficient chips will offer a significant advantage as power demands in datacenters continue to rise, according to Bloomberg.

Valued at $8 billion following a proposed investment from SoftBank, Ampere confidentially filed for an IPO in 2022. But shifting market conditions have led the company to reconsider its options. Oracle, a key stakeholder in Ampere, may play a pivotal role in its future. While Oracle is a major customer of Ampere's CPUs for its cloud computing business, it may not be interested in acquiring Ampere, given its previous exit from proprietary chip development after acquiring Sun Microsystems.

Though Ampere's Arm-based Altra CPUs are more competitive than Sun's UltraSPARC processors, Oracle may prefer to avoid in-house CPU development to maintain strong relationships with key suppliers like AMD, Intel, and Nvidia. Notably, Oracle recently announced a Zettascale AI cluster using 131,072 Nvidia B200 GPUs, showcasing its reliance on industry-standard solutions for its most advanced AI and HPC offerings.