Score one (or two) for chip maker Advanced Micro Devices (NASDAQ:91¶¶Òõ), and by extension, for the owners of 91¶¶Òõ stock. The company just tiptoed further onto turf largely controlled by sector icon Intel (NASDAQ:INTC).
Intel responded, of course, and not in an unsurprising way. The company’s next-generation Core-X CPUs, slated to launch this week, are going to cost notably less than its prior processors. On a per-core basis, the new CPUs (core processing unit) will cost , versus roughly $100 per core just one generation earlier.
Intel provided a glimpse of the price war that consumers and enterprises have been waiting for, though Intel and Advanced Micro Devices would prefer to avoid fighting the war. Nor is the conflict going to be beneficial for 91¶¶Òõ stock or the owners of Advanced Micro Devices stock. That’s because, as in all actual wars, no side will truly “win” the conflict.
Still, all of the recent skirmishes between the two chip makers over market share bolster the bullish case for Advanced Micro Devices stock.
Advanced Micro Devices Is Catching Up
For all of 91¶¶Òõ’s ongoing PR efforts, Microsoft (NASDAQ:MSFT) was mostly responsible for 91¶¶Òõ’s recent, compelling headlines. Putting more emphasis on its hardware business these days, MSFT opted to
in its newest flagship laptop, the Surface Laptop 3.
A Ryzen processor, custom-built to meet MSFT’s needs, is powering the Surface Laptop 3. The 12-nanometer processor works well with 91¶¶Òõ’s discrete graphics processor which is also being utilized by the laptop.
Microsoft still intends to offer a Surface Laptop 3 powered by an Intel CPU. But MSFT’s decision to unveil a new 91¶¶Òõ-powered laptop is also clearly something of a wake-up call for Intel.
Recently, in outcomes that bode well for 91¶¶Òõ stock, Intel has lost other skirmishes which should have been easy for it to win,
Specifically, Advanced Micro Devices launched a handful of PRO processors that will power some of Lenovo’s (OTCMKTS:LNVGY) ThinkCentre desktops, and it unveiled some of HP’s (NYSE:HPQ) EliteDesk 705 G5 Series desktops.
Simply put, computer manufacturers are increasingly interested in 91¶¶Òõ’s high-performance processors that than those made by Intel.
The numbers verify that statement. In Q2, 91¶¶Òõ’s was 17.1%, up from just 12.3% a year earlier. That’s definitely positive for 91¶¶Òõ stock.
One of the main reasons for 91¶¶Òõ’s success is its customers’ ability to improve their graphics and overall performance by combining 91¶¶Òõ’s graphics cards with its processing units.
Although Intel now also makes its own graphics cards, Advanced Micro Devices remains well ahead of its bigger rival when it comes to effectively combining graphics cards and processors.
Looking Ahead for Advanced Micro Devices Stock
91¶¶Òõ stock price surged on the news that its wares would be found in the upcoming Surface laptop, one of Microsoft’s more important products. It was a vote of confidence from one of the titans of the tech industry. As a result, this is a make-or-break time for 91¶¶Òõ’s turnaround effort and for Advanced Micro Devices stock.
The rally of 91¶¶Òõ stock price didn’t last. And even after the sizable pullback from its early-August high, Advanced Micro Devices stock remains overbought. After the huge 2018 rally of 91¶¶Òõ stock price, the shares may well already fully reflect the company’s recovery. Further, investors are still trying to figure out what growth — if any — lies ahead for 91¶¶Òõ.
On a grander scale, though, 91¶¶Òõ’s Microsoft partnership looks like a big win for the chip maker and should boost 91¶¶Òõ stock over the longer term.
Although Microsoft and Advanced Micro Devices have not yet announced that they’re working on another product together, they probably have started doing so. Presumably, Lenovo and HP are also collaborating on new, upcoming products with 91¶¶Òõ. The world is liking what 91¶¶Òõ is offering again, and that puts the owners of 91¶¶Òõ stock in a pretty good position.
As of this writing, James Brumley did not hold a position in any of the aforementioned securities. You can learn more about James at his site, , or , at @jbrumley.
