Advanced Micro Devices, Inc. (AMD - Free Report) is riding on robust traction witnessed by its EPYC processors across virtualized and hyperconverged infrastructure (HCI) architecture.
VMware (VMW - Free Report) recently added support to AMD’s Secure Encrypted Virtualization-Encrypted State (SEV-ES) in its latest vSphere release — 7.0U1.
Markedly, the company’s SEV-ES is part of AMD Infinity Guard, a suite of advanced hardware enabled features across second gen EPYC processors.
With this integration, VMware customers can benefit from enhanced data security in virtualized data center architecture via encryption of VM memory and improved performance.
These robust features are driving adoption of the integrated processors across notable OEM partners, looking to create vSAN ReadyNodes compliant with AMD EPYC processors and VMware HCI solutions.
For instance, Hewlett Packard Enterprises’ (HPE - Free Report) ProLiant DL325 and DL385 Gen10 and Gen10 Plus servers based on second gen EPYC processors are vSAN ReadyNode certified. Also, Lenovo’s ThinkSystem single and dual socket servers are VMware vSAN ReadyNode certified.
The new integration, enabling AMD’s SEV-ES on VMware’s vSphere 7.0U1, is aimed at providing customers the flexibility to choose security and performance features while utilizing EPYC based VMware solutions from OEMs.
AMD and VMware’s focus to enhance virtualization experience for the modern data center, and aid customers to securely accelerate high performance workloads and boost efficiency augurs well.
The integration bodes well for AMD as it highlights the strong security capabilities of its processors. Moreover, growing momentum of second gen EPYC processors is expected to drive AMD’s revenues in the upcoming days and instill investors’ optimism in the stock.
Strong Traction for EPYC Processors Bode Well
AMD is witnessing robust adoption of its second gen EPYC processors. Google Cloud has been expanding its use of second gen EPYC processors to provide enhanced security features to customers. Google Cloud’s latest Confidential Virtual Machines (“VMs”) leverage second gen EPYC processors’ Secure Encrypted Virtualization feature to help customers encrypt sensitive data not only when it is at rest but also while it is being processed.
Amazon (AMZN - Free Report) has implemented EPYC processors to power the latest Elastic Compute Cloud (EC2) C5a instances of Amazon Web Services (AWS).
HPE has also selected second gen EPYC processors to power its SimpliVity 325 Gen 10 HCI solution. The solution doubles the number of cloud-based virtual desktops supported per server from 300 to 600, which provides organizations with a 50% lower cost per remote worker.
Microsoft’s cloud computing platform — Azure — also selected AMD’s second gen EPYC processors to power its Azure NVv4 VMs. This will enable Azure to provide customers with a cloud-based virtual desktop capable of handling HPC workloads.
These major deal wins indicate a positive trend for AMD’s latest processors and are expected to drive the company’s top line in the quarters ahead. The momentum is likely to continue, courtesy of rapid growth in the cloud computing market at a CAGR of 14.9% between 2020 and 2027, per Grand View Research data.
Moreover, the coronavirus-induced work-from-home wave and increased use of online schooling solutions are driving demand for cloud computing solutions. These are favoring prospects of AMD.
AMD is likely to be negatively impacted by COVID-19 induced supply-chain constraints and broader macroeconomic weakness prevailing in the market.
Also, increasing expenses on product development amid stiff competition from Intel and NVIDIA, is likely to lead to pricing pressure and dampen profitability in the near term.
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