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AMD Collaborates With Meta to Help Make Metaverse a Reality

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Advanced Micro Devices (AMD - Free Report) announced on May 11 that the company is collaborating with Meta Platforms as an ecosystem partner to build a Metaverse-ready radio access unit (RAN).

The Metaverse, which is a set of immersive, interconnected and interoperable digital spaces, is likely to revolutionize the Internet in the days ahead. However, in order to make the Metaverse a reality, significant advancements are required in network latency, symmetrical bandwidth and overall speed of networks.

The transition to the Metaverse is a collective effort, and Meta has been collaborating with partners to develop and architect the required networking system for the Metaverse.

As such, AMD’s radio chip Xilinx Zynq UltraScale RFSoC will be utilized to develop multiple Evenstar radio units (RU) to expand 4G/5G mobile network infrastructure.

This collaboration with Meta is expected to showcase the importance of AMD’s investment in acquiring Xilinx back in October 2021 for a whopping $35 billion.

AMD’s shares, however, fell 0.91% to close at $87.92 after the release of the news on May 11. In the year-to-date period, AMD’s shares have tumbled 38.9% compared with the Zacks Computer and Technology Sector’s decline of 26%.

AMD Steps Into The Metaverse

The recent partnership with Meta under Meta’s mobile internet infrastructure program will help AMD foray into the alternate reality platform as it contributes to building the Metaverse.

Meta launched the program called Evenstar back in 2020 and promotes a platform called OpenRan that makes it possible for cellular network operators to mix and match hardware for building base stations instead of buying it from one equipment maker.

Meta launched this program in order to make Metaverse a reality. Metaverse will allow geographically distant participants to enjoy realistic experiences that blend virtual content into a user’s physical world. In order to achieve this feat, an improved RAN supporting 4G, and 5G networks are required. A RAN is the radio element of a cellular network required to wirelessly connect mobiles, laptops or remotely controlled machines. Nevertheless, this is a costly affair.

Meta’s recent partnership with AMD will, however, reduce base station costs to make broadband accessible worldwide.

AMD will help Meta aggressively reduce costs in making Evenstar RUs and achieve the goal of expanding into uncovered regions and the underdeveloped countries to connect more people to the Metaverse.

AMD’s collaboration with Meta will aid the company in transitioning out of the slowing pc market and concentrate on semi-custom chip business, which will help to expand in high-growth markets like the Metaverse.

Metaverse, upon completion, is expected to generate hundreds of billions of dollars in digital commerce and support millions of jobs and new projects for creators and developers.

Zacks Rank and Stocks to Consider

While AMD, which carries Zacks Rank# 3 (Hold), is a stock worth retaining in the portfolio, here are some better-ranked stocks to consider in the broader sector to gain more returns.

Analog Devices (ADI - Free Report) currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

ADI shares have fallen 11.7% in the year-to-date period compared with the Zacks Semiconductor - Analog and Mixedindustry’s decline of 19.2%.

Cisco Systems (CSCO - Free Report) presently carries a Zacks Rank of 2.

Cisco shares have decreased 21.8% in the year-to-date period compared with Zacks Computer-Networking industry’s decline of 22.2%.


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