AMD’s Earnings Reaction: After AMD’s fourth-quarter earnings, the stock initially rose but then fell due to unmet expectations in data center performance, with lowered forecasts for AI revenue in 2025 contributing to recent stock declines.
Advanced Micro Devices (AMD) vs. Nvidia (NVDA): Wedbush’s Matt Bryson views AMD as ‘the best alternative’ to Nvidia in the AI and data center market, despite competition from hyperscalers like Microsoft (MSFT), Google (GOOG, GOOGL), and Amazon (AMZN) developing their own processors for internal use.
Custom Chips and Market Position: While custom ASICs pose a challenge for AMD, especially in known workload scenarios, Bryson believes AMD’s plug-and-play offerings are advantageous for cloud services with variable workloads, maintaining its competitive edge against custom solutions like those from Broadcom.
In a recent discussion on Yahoo Finance, Matt Bryson, Managing Director of Equity Research for Hardware at Wedbush Securities, analyzed Advnaced Micro Devices‘ (AMD) latest fourth-quarter earnings. Despite a brief positive reaction in stock price following the earnings release, the stock later declined, which Bryson attributed largely to data center performance not meeting market expectations. He noted that expectations for AMD’s AI-related revenue in 2025 have significantly decreased over the past month, contributing to the stock’s recent poor performance.
Bryson discussed AMD’s position in the competitive AI and data center market, particularly in relation to Nvidia. He sees AMD as the primary alternative to Nvidia, especially as major cloud providers like Microsoft (MSFT), Google (GOOG, GOOGL), and Amazon (AMZN) develop their own processors for internal AI inference workloads. However, he believes there’s still demand for a Nvidia-like solution in the market, suggesting that AMD remains relevant due to its similarity to Nvidia’s offerings, providing a plug-and-play alternative that hyperscalers might prefer over custom silicon for certain applications.
The conversation also touched on the broader competitive landscape involving custom chips, where companies like Broadcom (AVGO) are involved. Bryson pointed out that while custom ASICs are becoming more prevalent for specific internal workloads, where the exact nature of the tasks is known, AMD’s challenge lies in this area. Nevertheless, he remains optimistic about AMD’s market position, arguing that for more general or unpredictable workloads in cloud environments, AMD’s solutions are more versatile and easier to implement than custom chips, maintaining its competitive edge despite the evolving market dynamics.
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