This is an announcement we have been waiting for at STH for about a year. Gigabyte has been planning to spin out its server division for several quarters now, and it has finally taken into effect. The new company is called “Giga Computing”.
Welcome Giga Computing as Gigabyte Spins Out Server Division
Here is an excerpt from the press release:
GIGABYTE and Giga Computing have an agreement in place to maintain the same development and support for all GIGABYTE enterprise products and solutions for customers. These systems and products sold by Giga Computing will, for the time being, continue to use the familiar GIGABYTE brand that is known and respected in the tech sector. (Source: Gigabyte)
While this may sound like a large change, to be clear, a lot is staying the same. Giga Computing is a subsidiary of Gigabyte, and so we expect a lot will look familiar to STH readers for the time being.
A few examples are that the products will still be Gigabyte Server products, and they can be found on Gigabyte’s existing server website.
Many of our readers may wonder why Gigabyte is doing this. From what I have gathered, the server business and consumer businesses have different margin profiles. Gigabyte also has different agreements and histories with key suppliers like Intel and NVIDIA than many of its server-focused peers. For example, Intel’s agreement with Gigabyte is one of the reasons the company has been so aggressive in Arm-based servers for many years. Spinning out the server division as its own subsidiary allows for some of these agreements to change to a data center focus rather than a consumer focus.
Beyond that, spinning out the server division allows Gigabyte to potentially raise capital for the server division. There have been firms looking to invest in the server side as other companies like Supermicro have focused more on selling complete systems rather than barebones.
The bottom line is that there is not much change for now, other than the new subsidiary has been created. Stay tuned for more on this front as 2023 progresses.