Advanced Micro Devices ( AMD Quick Quote AMD - Free Report) has announced the launch of its latest Ryzen Embedded R-Series system-on-chips processors to expand its product portfolio to address new and trending markets.
The new Ryzen processor is specifically designed to address solutions for industrial and robotics systems, machine vision, IoT and thin-client equipment. Ryzen Embedded R2000 series doubles the core count and uplifts performance compared to prior models, with upto 81 percent higher CPU and graphics performance.
The company is constantly improving the performance of its Ryzen processors to help address the rising demand for the same, courtesy of the increasing proliferation of AI and Machine Learning (ML) in industries like cloud, gaming and data center.
This has impacted AMD's first-quarter 2022 revenues positively and is expected to aid its 2022 top-line growth.
AMD Product Portfolio to Help Boost Stock Prices
Shares of AMD have lost 41.8% compared with the Zacks
Electronics - Semiconductors industry’s and the Zacks Computer and Technology sector’s declines of 31.1% and 32.3%, respectively, in the year-to-date period.
The recent fall in share prices can be attributed to global supply chain challenges in the semiconductor industry, the Russia-Ukraine war and rising inflation that skyrocketed AMD’s operating expenses by 62% in the first quarter of 2022.
Negative sentiments among investors about the overall tech industry amidst macro-economic turmoil are reflected by the downfall of the tech-heavy NASDAQ index, which pulled down AMD prices.
Further, as AMD ventures into new markets, the company is facing rising competition from the likes of
NVIDIA ( NVDA Quick Quote NVDA - Free Report) .
NVIDIA is giving AMD tough competition in the high-performance computing (“HPC”) market. NVIDIA’s superchips have been benefiting from the rapid proliferation of AI while the company is expanding its base in untapped markets like climate science, energy research, space exploration and digital biology.
However, in order to address the rising inflation, the Federal Reserve has announced the biggest interest rate hike in the last 28 years. The Fed expects this move to curtail spending and rekindle traders’ interest to go long, specifically in cyclical sectors like technology.
AMD is expected to benefit from this due to its plans to address new markets, accelerate data center growth, and enter the AI and AR spaces with its launch of various new products.
AMD’s strategic acquisitions of Xilinx and Pensando will help the company address its expansion in uncharted AR space and data center business with its collaborated products.
The recent acquisition of Xilinx has helped AMD collaborate with
Meta Platforms ( META Quick Quote META - Free Report) to enter the metaverse.
AMD has become Meta’s ecosystem partner and AMD’s radio chip, Xilinx Zynq UltraScale RFSoC, will be utilized to develop a metaverse-ready radio access unit.
Also, the company is looking to capture a significant share of the $300-billion market of high-performance and adaptive products.
AMD is leading its peers in HPC by forming strategic partnerships to build products that set the bar quite high.
It is worth mentioning that AMD powers five of the top ten most powerful and eight of the top ten most energy-efficient supercomputers globally.
Recently, AMD partnered with
Hewlett Packard ( HPE Quick Quote HPE - Free Report) and the U.S. Department of Energy’s Oak Ridge National Laboratory to build the world’s fastest and most energy-efficient supercomputer — Frontier.
The company’s strong product portfolio and the strategy to enter new and emerging markets like HPC and the metaverse will aid its revenue growth. Its strategy will impact the stock prices positively and generate positive returns in the long run.
AMD currently carries a Zacks Rank #3 (Hold). You can see
the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.