Advanced Micro Devices  Stock Is Up 45% in 2 Weeks: What’s The Buzz?

Over the course of the past year or so Advanced Micro Devices, Inc. (NASDAQ:AMD) has emerged as one of the world’s foremost chip makers and it got another major boost on Tuesday. The company is now working towards gaining market share in a big way in the server chips segment and in a recent development, it snatched market share from its major rival Intel Corp.

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 The company managed to pip Intel largely due to its close relationship with a large factory partner in Taiwan. This is a significant development for AMD and the market recognized that as well. The company’s stock surged by as much as 11% on Tuesday after the news broke.

In such a situation, it could be worthwhile for investors to take a closer at the full ramifications of the development. The growth in the server chips segment is expected to boost AMD’s revenues for the third fiscal quarter to around $2.55 billion, according to an announcement from the company yesterday. 

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That figure is higher than analysts’ expectation of $2.3 billion for the quarter. In addition to that, AMD also boosted its projections for full-year sales, and considering the fact that the company beat analysts’ expectations in the second year, this is a major development. 

AMD had been playing catch up with the chips giant Intel for many years and hence, this is a landmark development for the company. The company managed to upstage Intel in this instance because of its relationship with Taiwan Semiconductor Manufacturing Co, which manufactures chips on AMD’s behalf. 

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While the AMD stock is surging, the situation in Intel has been a bit gloomy due to the recent setbacks suffered by the company. This past week the company announced that it has fallen behind schedule in its quest to create advanced semiconductors. In addition to that, Intel also announced that it could ditch successful long term strategy of manufacturing chips in-house. These are developments that can only come as a boost for AMD, which has been chasing Intel for market domination for years. 

After Intel made those announcements, the stock suffered from a significant selloff as well and provided a glimpse into the fact that it is possibly being surpassed by the Taiwan Semiconductor Manufacturing Co. The Chief Executive Officer of AMD Lisa Su made further bullish statements that added more fuel to the rally. 

She said that AMD will continue to gain market share as computer manufacturers keep adopting the newer products that are going to be introduced by the company. At this point, AMD enjoys more than a 10% share of the server chips market and Su added that despite the supply is tight, the company is well placed to meet rising demand.

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