Cloud Computing: AMD Chief Lisa Su Aims to Take Massive Market Share From Intel

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Cloud Computing: AMD CEO Lisa Su

AMD CEO Lisa Su

Courtesy of AMD

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Improved Micro Devices

(AMD) CEO Lisa Su is plotting a route in which she sees the chipmaker taking indispensable share from
Intel

within the server chip market.

On Tuesday, AMD unveiled fresh particulars about its 7-nanometer (nm) subsequent-technology server chip, known as “Rome”, at a product event. The chip is slated to commence subsequent 300 and sixty five days.

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AMD has already projected this will well attain a “mid-single digit” share of the server chip market with its fresh offerings by 300 and sixty five days-quit versus the no longer as a lot as 1% share it had last 300 and sixty five days. Nonetheless Su instructed Barron’s in a cellular telephone interview Wednesday the company’s longer-timeframe aspirations are unparalleled increased.

When asked if AMD will be ready to exceed the historical high of 25% of the server chip put it on the market had in 2006, Su spoke back, “My imaginative and prescient is to exceed that market share … Yes, AMD’s outdated height was once 25% to 26% share, but our fresh product design is extra healthy than the Opteron [the 2006 chip] days.”

AMD stock has soared greater than a hundred% this 300 and sixty five days on anticipation this will well save extra industry from Intel in keeping with its an increasing selection of aggressive chip technology.

Intel (INTC) has suffered from repeated delays in difficult to 10nm chip-manufacturing technology from 14nm as of late, which it now initiatives will be on hand within the 2d half of 2019. Nonetheless even when Intel hits that forecast, AMD will doubtless be pleased an relief as it expects to provide 7nm Rome chips by then.

One nanometer equals one-billionth of a meter. Smaller nanometer chipmaking technologies traditionally be pleased allowed companies to assemble sooner, extra energy-atmosphere gracious chips.

“We in actuality feel in actuality factual about where the efficiency of Rome [will be] relative to the competition,” Su mentioned. “We ask indispensable earnings in 2019 from Rome [although] 2d-half weighted.”

She cited how one Rome chip outperformed two of Intel’s fresh 8180 server chips, in keeping with AMD benchmarks. Intel did no longer straight respond to a seek recordsdata from for observation on the command.

AMD shares rose four.four% to $21.60 on Wednesday. In 2006, the 300 and sixty five days when its share of the server chip market topped out, the company’s stock traded above $40.

Intel currently dominates the high-earnings-margin recordsdata-heart industry, where it sells server chips to cloud computing companies and corporations. Analysts estimate that Intel’s recordsdata-heart community will generate $23.2 billion in gross sales and $eleven.four billion in working earnings in 2018, in keeping with FactSet.

In comparability, the Wall Avenue consensus for AMD’s entire 2018 gross sales is factual $6.5 billion, so a indispensable amplify in AMD’s server chip industry may maybe well be a monetary boon for it.

“We are looking for to level to a consistent music document of execution,” Su mentioned. “We imagine that we are able to continue to maintain share.”

Write to Tae Kim at tae.kim@barrons.com


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