AMD pops 16% on launch of second-generation server CPUs, signs big tech companies

Advanced Micro Devices

AMD up 16% on launch of second-generation server CPUs

Chipmaker Advanced Micro Devices (NASDAQ: AMD) announced on late Wednesday that Twitter, Google, and other companies have joined its roster of customer adopting their new, second-generation EPYC server processors.

With other major companies like Hewlett Packard Enterprise and Lenovo both announcing the immediate deployment of these new server chips, investors have been especially impressed with AMD. In response, shares of the chipmaker jumped by 16 percent over the course of the day.

Over the past couple of years, AMD has been surging ahead of the chip industry in terms of its market share. The ever-increasing popularity of its EPYC server and the Ryzen CPU lineup has given the company an edge over its competition that doesn’t seem likely to change anytime soon.

“Today, we set a new standard for the modern datacenter with the launch of our 2nd Gen AMD EPYC processors that deliver record-setting performance and significantly lower total cost of ownership across a broad set of workloads. Adoption of our new leadership server processors is accelerating with multiple new enterprise, cloud and HPC customers choosing EPYC processors to meet their most demanding server computing needs,” said Dr. Lisa Su, CEO and President of AMD.  “Its scalable compute, memory and I/O performance will expand our ability to drive innovation forward in our infrastructure and will give Google Cloud customers the flexibility to choose the best VM for their workloads,” added Bart Sano, Google vice president of Engineering.

In response to these developments, other chipmakers have become worried.  Back in May, Intel ended up plunged when it revealed to investors that it expects it’s market share to fall by 28 percent by 2023 against AMDs superior lineup.

While Intel’s latest processors can still be argued as the most powerful CPUs today for personal computers, AMD’s Ryzen CPUs have a great reputation for their multitasking capacities. They also are far more energy-efficient than Intel’s latest CPUs, with AMD claiming that their newest processors save 30 percent more power then their closest competition.

AMD also has an advantage in the fact that it has a lower pricing strategy, putting pressure on Intel to also lower their prices to keep up or get left behind.

Shares of AMD jumped by 16.2 percent in response to the news on Thursday, ending the day around $33.92 per share. The past six months have seen the stock rise consistently amidst a series of volatility spikes, rising almost 50 percent from $23 per share to its current price level. Most analysts covering the stock have a “strong-buy” recommendation for AMD and the company continues to do well for itself.

Advanced Micro Devices Company Profile

Advanced Micro Devices designs and produces microprocessors and low-power processor solutions for the computer and consumer electronics industries. The majority of the firm’s sales are in the computer market via CPUs and GPUs. AMD acquired graphics processor and chipset maker ATI in 2006 in an effort to improve its positioning in the PC food chain. In 2009, the firm spun out its manufacturing operations to form a foundry joint venture, GlobalFoundries. – Warrior Trading News