Back
Benzinga

AMD Analysts See Momentum Ahead, With Xilinx Deal Expanding Market Opportunity

October 28, 2020
Hans Mosesmann

The deal boosts AMD's total addressable market from $80 billion to $110 billion, Pitzer said.

The incremental opportunity comes from Xilinx's exposure to datacenter, networking and auto/industrial, the analyst said.

AMD's third-quarter revenue and EPS outperformance was due to strong performances by the Enterprise, Embedded and Semi-custom and Computing & Graphics segments, he said.

The C&G segment's results were driven by record Ryzen revenues and units and the 12th consecutive quarter of share gains, the analyst said. The EESC segment, meanwhile, benefited from second generation EPYC revenues more than doubling year-over-year and strong semi-custom revenues from Sony Corp SNE 0.79% and Microsoft Corporation MSFT 0.49% console ramps, he said.

The better-than-expected fourth-quarter guidance reflects continued EPYC share gains, momentum in Ryzen, the Radeon 6000 GPU product launch and sequential growth in semi-custom revenues, Pitzer said.

AMD is on track to ship the next-gen Milan server processor based on Zen 3 architecture in the fourth quarter, with volume production expected in the first quarter of 2021, the analyst said.

Credit Suisse also sees higher graphics revenues ahead, with Ryzen 5000 and cloud-based CDNA wins.

Related Link: 3 Takeaways On AMD's New Ryzen 5000 Series

AMD Could Double In Size, Rosenblatt Says: With new product cycles coming by way of Ryzen 5000 and Milan EPYC3, the momentum seen in the third quarter is likely to continue into 2021, Rosenblatt analyst Hans Mosesmann said in a note.

AMD's acquisition of Xilinx makes sense given that the data center market is in massive flux and offloading dynamics are becoming ever more important, the analyst said.

"With Intel Corporation INTC 3.42% continuing its woes, we see no reason why AMD can't capture 50% of the entire x86 CPU market in coming years on technology/product roadmaps, accelerating design pipelines, increasing attach rates of GPUs to optimize EPYC server CPUs, etc," he said.

AMD's ability to have both a strong x86 CPU and GPU roadmap will have significant and sustainable advantages in the world of computing that Intel and NVIDIA Corporation NVDA 0.15% do not have, Mosesmann said.

Given the secular opportunity and $110-billion TAM, inclusive of the Xilinx acquisition, AMD's prospects of doubling in size over the next several years are quite achievable, the analyst said.

Rosenblatt Securities reiterated a Buy rating on AMD with a $120 price target.

Link to Full Article.

Recent Posts
Back To List