Ahead of AMD (NASDAQ:AMD) reporting fourth quarter results, Intel (NASDAQ: INTC) and Nvidia (NASDAQ: NVDA) posted weak numbers that spooked AMD shareholders. So when CEO Lisa Su proudly announced strong growth, the stock rallied from $20 to ~ $24.50, giving investors a nice 17% weekly gain.
Ryzen and EPYC Refresh
The product refresh to the 7nm production helped drive ASP and sales. For 2019, AMD expects strong mainstream, budget, and high-end sales will more than offset weaker console and GPU sales. The firm faced volume constraints on the low end, where budget chips were in short supply. Mobile Ryzen and the higher performance platform raised ASP and will boost AMD’s bottom line for this year, at the very least.
GPU Lagging
The GPU continued to lag in the quarter, hurt by the fallout in cryptocurrency in 2018. Of the segments – Polaris (GPU), Radeon (for high-end performance computing), and console, Radeon is growing at the fastest pace. The Radeon 7 release this month (Feb. 7) will probably accelerate the Radeon’s market position in the professional and gaming market. HBM2 is rumored to be expensive and in short supply. Assuming demand matches supply, AMD will be well-positioned to take Nvidia’s market share.
AMD’s lowered revenue guidance suggests a pull-back is possible. At a 35 times forward P/E, the stock falling is healthy. That may create yet another entry point for investors.
Tech Insider
