AMD Blasts Through $100/Share During Trading To All Time Record High Price!
Chip designer Advanced Micro Devices, Inc (AMD) has soared past an all-time high share price today after it reported stellar earnings results for the second quarter of 2021. AMD, which has grown in popularity among consumer and enterprise users due to its use of leading-edge semiconductor technologies for its products, was expected to post $0.54 in earnings per share (EPS) by analysts, but it managed to surpass this by nearly 17% by posting an EPS of $0.63 earlier this week.
AMD Is Now Worth $125 Billion As Strong Second Quarter Earnings Push Share Price To Record Highs
The standout feature of AMD's second-quarter earnings was the company's data center sales. AMD designs processors and graphics processing units for regular and professional users and sells them under the Ryzen and Radeon branding, respectively. Additionally, it also sells processors for companies employing large-scale data servers and sells them under the EPYC branding.
Its earnings report revealed that the company's datacenter sales helped propel its revenue from the Enterprise, Embedded and Semi-Custom segment by an eye-popping 183% year-over-year. This segment includes sales of EPYC processors and hardware for gaming consoles from Microsoft Corporation and Sony Corporation.
In its earnings presentation, AMD revealed that it had experienced a "5th straight quarter of record server processor revenue, including demand for 2nd and 3rd Gen EPYC processors." While on its own, the statement would appear ordinary for a company that posted another record revenue growth in the quarter, when analyzed in tandem with semiconductor behemoth Intel Corporation, the growth demonstrated that AMD is on an upward trajectory.
Intel's earnings report for the second quarter revealed that the company's datacenter segment earned $6.5 billion in revenue, dropping by 9% year-over-year. Intel attributed the drop to a "challenging compare and competitive environment," as it also revealed that it was ramping up production of processors on its 7nm and 10nm semiconductor fabrication processes.
AMD, which sells chips manufactured by the Taiwan Semiconductor Manufacturing Company (TSMC), currently offers processors and graphics processing units (GPUs) manufactured on what TSMC markets are as the 7nm process node. The company plans to upgrade these to offer products manufactured on the Taiwanese company's 5nm process node, but supply constraints limit its ability to bring products to the market as quickly as the consumer would hope.
While TSMC has started to mass-produce semiconductors on the 5nm node, AMD cannot gain access to the production due to orders from Cupertino tech giant Apple Inc's upcoming iPhone upgrade. Apple, which is rumored to be TSMC's biggest customer, is often the first company to gain access to new chipmaking technologies, partly due to the duo's close relationship and partly due to different manufacturing requirements for smartphone processors generally smaller than their personal computing counterparts.
AMD's record share price gain also follows an important product roadmap reveal by its only competitor in the x86 microprocessor market. Intel, who is ramping up production of what was formerly dubbed as the 7nm node and thought by many to be superior to TSMC's similarly dubbed process, revealed that its Intel 7 process (formerly dubbed as 10nm is ready for volume production with the first products arriving in the fourth quarter of this year.
AMD's third-generation EPYC chips are manufactured with TSMC's 7nm process, and if we remove nomenclature differences, then Intel's processors should feature 11% more transistors than TSMC-made chips for a similar node. Intel's production processes are believed to involve a higher use of extreme ultraviolet (EUV) light than TSMC, allowing it to reduce feature sizes at a larger scale and improve density. EUV light has a shorter wavelength than deep ultraviolet (DUV) processes, but it introduces its own production complexities into the mix.