Lisa Su, AMD’s CEO and President said “The Company has won a third semi-custom chip design contract that could generate a billion dollars in sales over their lifetime.” After that there are many rumors the Nintendo NX processors are likely to be made by AMD. It is not that shocking because AMD already supplies the chips for Nintendo’s Wii U, Microsoft’s Xbox One and Sony’s PlayStation 4.

Nintendo NX processors are likely to be made by AMD, how will it benefit both the companies?

This chip project is of significant importance for AMD because it has reported losses for the last couple of quarters and the project could help them make huge profits. It is also important for Nintendo as the processor is the key to whether the next console of Nintendo will be competitive and affordable.

According to the latest buzz, Nintendo could make the leap to AMD’s x86-based architecture from IBM’s PowerPC. AMD has classified its gaming console chips as “semi-custom,” and these APU (accelerated processing unit) chips combine a GPU and CPU on a single chip. AMD has not yet confirmed anything about it, but the evidence is growing that Nintendo NX processors are likely to be made by AMD. These APU chips are also made by Intel, but AMD had an edge in the previous generation of consoles because it mainly focused on the graphics side of the chip.

AMD has also successfully sold custom versions of its APUs to Sony and Microsoft. With APU’s AMD is trying to cut out one chip from the system. It is now a well known fact that Advanced Micro Devices (AMD) had designed and now supplies the processors for all the major gaming consoles. So it is not surprising that Nintendo NX processors are likely to be made by AMD, which is expected to launch in 2016.