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Published Date: 05/07/2024
With a 23% decline in its stock price, AMD presents a solid buying opportunity. Don't write off this semiconductor stock just yet, as it's poised to capitalize on the growing AI market.
With a 23% decline in its stock price, AMD presents a solid buying opportunity. Don't write off this semiconductor stock just yet, as it's poised to capitalize on the growing AI market.
The recent decline in Advanced Micro Devices' (AMD) stock price may have left investors feeling uncertain about its future prospects. However, a closer examination of the company's position in the artificial intelligence (AI) market reveals a compelling buying opportunity. Despite missing growth expectations in the first quarter of 2024, AMD is well-positioned to capitalize on the growing sales of AI-enabled computers and data center business.
In the client processor business, AMD has been rapidly gaining market share from Intel, with its new generation of Ryzen processors equipped with dedicated hardware to enable AI applications. The company estimates that its processors could power more than 150 AI software experiences by the end of 2024, driving further market share gains.
In the data center business, AMD's graphics processing unit (GPU) business is gaining traction due to the massive demand for AI accelerators. The company is forecasting $4 billion in revenue from sales of data center GPUs this year, a significant increase from previous quarters. Additionally, AMD's Epyc server CPUs are being deployed for AI inference applications, driving solid growth in data center revenue.
With a strong presence in both the client processor and data center markets, AMD is poised to benefit from the growing AI trend. Despite the recent pullback, the company's growth prospects remain robust, making it a compelling buy for investors.
InformationÂ
Advanced Micro Devices (AMD) is a leading semiconductor company that develops and manufactures microprocessors, graphics processors, and other semiconductor products.
The Motley Fool is a financial services company that provides investment advice and resources to individual investors.
FAQs:
FAQs:
Q: What is driving AMD's growth in the client processor business?
A: AMD's new generation of Ryzen processors equipped with dedicated hardware to enable AI applications is driving growth in the client processor business.
Q: What is the forecast for AMD's revenue from sales of data center GPUs?
A: AMD is forecasting $4 billion in revenue from sales of data center GPUs this year.
Q: What is driving growth in AMD's data center revenue?
A: Growth in AMD's data center revenue is being driven by the company's GPU business and the deployment of its Epyc server CPUs for AI inference applications.
Q: What is AMD's market share in the client processor business?
A: According to Mercury Research, AMD's market share in desktop central processing units (CPUs) stood at 23.9% in the first quarter of 2024, an increase of 4.7 percentage points from the year-ago period.
Q: What is the forecast for the global server market?
A: The global server market is expected to grow at more than 12% a year for the next five years.
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