Advanced Micro Devices, Inc. AMD is well poised to benefit from robust adoption of Ryzen, Radeon and latest second-gen EPYC server processors.
Moreover, the growing clout of GPUs driven by increasing adoption of AI techniques and ML tools in industries like gaming, automotive and blockchain holds promise.
Particularly, AMD’s high-performance 2nd Generation EPYC processors have been gaining traction in the supercomputing space of late. In fact, the company’s Zen 4 architecture based EPYC CPUs will be implemented in El Capitan exascale class supercomputer at Lawrence Livermore National Laboratory.
The company is leaving no stone unturned to capitalize on growth markets across high-performance PC, gaming and data center markets, which the company estimates to have a total addressable market of $79 billion.
Advancements in Core Architecture: A Key Catalyst
The chip maker is strategically evolving hardware capabilities with integrated software functionalities by introducing advanced architecture and packaging technologies, in a bid to up its ante in PC, gaming, and data center markets.
In gaming domain, the company recently announced that RDNA 2 (or Radeon DNA) graphics architecture supported processors will be introduced in late 2020. Notably, AMD RDNA 2 architecture is aimed at supporting variable rate shading (VRS), hardware-accelerated ray tracing features.
AMD’s “Navi 2X” GPUs based on RDNA 2-architecture are designed to deliver advanced 4K gaming experience with hardware-based ray tracing features and high performance. This is expected to aid AMD strengthen its competitive position against NVIDIA NVDA in the GPU market.
In data center compute end-market, AMD aims to launch Compute DNA (AMD CDNA) architecture supported products in late 2020. The products are designed to accelerate high-performance computing (HPC) and complex machine learning applications.
The chipmaker intends to roll out Ryzen processors utilizing its new “Zen 3” core architecture in late 2020. Moreover, the company aims to deliver “Zen 4” core architecture, which is “currently in design” utilizing advanced 5 nanometer (nm) process technology. This is expected to provide AMD a significant edge over Intel INTC, which is yet to deliver 7 nm chips.
Notably, Intel’s chips utilize process technologies that are designed in-house. Meanwhile, AMD is currently leveraging Taiwan Semiconductor Manufacturing Company’s TSM 7 nm process technology, which is enabling it to deliver its advanced 7 nm chips faster to market.
No Guidance Revision Despite COVID-19 Woes
Much to the chagrin of its rivals in the semiconductor industry, AMD maintained outlook despite lingering coronavirus woes. AMD anticipates the impact of COVID1-19 outbreak to be “modest” in first-quarter 2020, with revenues possibly coming near the lower end of its guidance of $1.8 billion (+/- $50 million). Moreover, the company has kept 2020 guidance intact.
Nevertheless, we believe increasing expenses on product development amid stiff competition from NVIDIA and Intel are likely to weigh on profitability at least in the near term.
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