FFor most investors, the evolution of a stock’s price over time is important. Not only can this impact your investment portfolio, but it can also help you compare investment results across sectors and industries.
Another factor that can influence investors is FOMO, or the fear of missing out, especially with tech giants and popular consumer-facing stocks.
What if you had invested in Advanced Micro Devices (AMD) ten years ago? It may not have been easy to hold onto AMD all this time, but if it was, how much would your investment be worth today?
In-Depth Business Analysis of Advanced Micro Devices
With that in mind, let’s take a look at the key business drivers for Advanced Micro Devices.
Advanced Micro Devices has strengthened its position in the semiconductor market through its evolution as an enterprise-focused company from a purebred consumer PC chip supplier. AMD has become a serious competitor to NVIDIA’s dominance in the graphics processing unit or GPU market based on its Radeon technology.
The launch of the 7 nanometer (nm)-based AMD Radeon RX 5700 series gaming graphics card family with RDNA architecture, high-speed Graphics Double Data Rate type 6 (GDDR6) memory and PCIe 4.0 interface support, has helped the company increase its presence among gamers.
Additionally, the AMD Radeon Instinct GPU product family is gaining traction in data center applications, including deep learning training and traditional high-performance computing (HPC) workloads.
Additionally, the AMD EPYC 7001 series of high-performance processors helps AMD gain market share in the server market. In addition, the AMD EPYC Embedded 3000 processor series addresses new markets, including networking, storage and edge computing devices.
On October 27, AMD announced that it had entered into a definitive agreement to acquire Xilinx for $35 billion in an all-stock transaction. The takeover will significantly contribute to the expansion of AMD’s data center business.
In the consumer PC market, AMD has become a key challenger to Intel with the AMD Ryzen family of desktop processors. The company’s desktop processor offerings include high-end Ryzen and Ryzen Threadripper processors, among others. The AMD Athlon and AMD PRO series of processors are aimed at the commercial and consumer desktop PC market.
AMD’s processors are primarily powered by the company’s proprietary “Zen” CPU and “Vega” GPU architectures. Based in Santa Clara, Calif., AMD generated revenues of $16.434 billion in 2021. The company reports its business in two segments: Computing and Graphics, and Enterprise, Embedded and Semi-Custom.
The Computing and Graphics segment includes desktop and notebook processors and chipsets, discrete GPUs and professional graphics. This segment generated revenues of $9.332 billion in 2021.
The Enterprise, Embedded and Semi-Custom segment includes server and embedded processors, dense servers, semi-custom SoC products, engineering services and royalties. This segment generated $7.102 billion in revenue in 2021.
Anyone can invest, but building a successful investment portfolio takes research, patience, and a bit of risk. So if you invested in Advanced Micro Devices ten years ago, you’re probably feeling pretty good about your investment today.
A $1,000 investment made in June 2012 would be worth $18,551.48, or a gain of 1,755.15%, as of June 6, 2022, according to our calculations. This return excludes dividends but includes price appreciation.
The S&P 500 rose 221.47% and the price of gold rose 9.78% over the same period in comparison.
Going forward, analysts expect more benefits for AMD.
AMD is benefiting from strong demand for its Ryzen and EPYC server processors, due to the increasing proliferation of artificial intelligence (AI) and machine learning (ML) in industries such as cloud, gaming and data centers. The growing weight of 7 nanometer (nm) products in the data center vertical market, driven by work-from-home and e-learning trends, is a key enabler. AMD provided strong revenue guidance for 2022, supported by robust growth across all businesses. Increasing revenue from servers and client processors will likely lead to a sequential increase. The acquisition of Xilinx and Pensando will boost AMD’s data center business. Alliances with Amazon, Microsoft, Baidu and JD.com increase business prospects. However, fierce competition from NVIDIA and Intel is a concern. Year-to-date, stocks have underperformed the industry.
Free: Top Actions for the $30 Trillion Metaverse Boom
The Metaverse is a leap forward for the internet as we know it now – and it will make some investors rich. Like the Internet, the metaverse is set to transform the way we live, work, and play. Zacks has written a new special report to help readers like you aim for big profits. Metaverse – What is it? And how to take advantage of these 5 pioneering actions reveals specific actions set to soar as this emerging technology grows and expands.
Download Zacks Metaverse Report Now >>
Click to get this free report
Advanced Micro Devices, Inc. (AMD): Free Inventory Analysis Report
To read this article on Zacks.com, click here.
Zacks Investment Research
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.