Despite the current difficulty of declining PC demand for Advanced Micro Devices (AMD stock), Cowen contends that investors should take a longer-term perspective on the strength of the chip maker’s offerings.
The company’s third-quarter results and prognosis, which were released on Tuesday, reflected the difficult conditions of today.
AMD (NASDAQ:AMD) published a revenue projection for the December quarter below expectations, citing declining PC demand, and posted results broadly in line with its prior negative pre-announcement in October. The business provided a range of sales guidance for the current quarter, with a midpoint of $5.5 billion, falling short of the average estimate of $5.95 billion.
Matthew Ramsay, a Cowen analyst, reiterated his Outperform rating and $100 price target following the release.
He added that the chip manufacturer’s “product road map, particularly datacenter, has never been better [moving] into 2023].” We have faith in the company’s long-term momentum for share gains and product lineup.
Despite the unimpressive prediction, AMD (AMD Stock) shares rose 2.8% to $61.34 in Wednesday’s noon trade. The Dow industrials and the S&P 500 experienced losses of 0.6% and 0.2%, respectively.
Ramsay claimed AMD’s financial problems only affected the consumer and business PC market, stating that its datacenter chip revenue increased by 45% compared to last year. He also mentioned how, at the same time, AMD’s server-chip sales to cloud computing suppliers more than doubled.
“We think the Street has under-modeled [AMD’s] cloud share growth in 2023,” he added.
During a results conference call on Tuesday AMD management stated that there is still room for long-term growth for the company in the high-performance computing sector. According to CEO Lisa Su, AMD doesn’t anticipate any supply issues affecting its datacenter processor business in 2019.
Featured Image- Megapixl @ Hisdx15
Author Valerie Remorosa