New chips could mean bigger gains for the semiconductor company.
What happened
Shares of Advanced Micro Devices (NASDAQ:AMD) climbed 8.4% on Wednesday after the chipmaker announced a new line of desktop processors.
So what
AMD’s new Ryzen 4000 Series processors will be built on its “Zen 2” architecture and advanced 7-nanometer manufacturing process. They will integrate Radeon Graphics and are expected to deliver significant gains in performance and energy efficiency. AMD’s processors are designed for the gaming and streaming markets, as well as mainstream consumers. A PRO class of chips, which contain high-end security features and other advanced technologies, is meant for the enterprise market.
The debut of Advanced Micro Devices’ new Ryzen processors helped to drive its stock higher on Wednesday. Image source: Getty Images.
Computer makers such as HP and Lenovo will begin including AMD’s new processors in their PCs in the third quarter.
Now what
The coronavirus pandemic is boosting demand for gaming systems as well as computers that can help people work efficiently from home. AMD and other PC component makers stand to benefit from these trends.
Moreover, if their improved performance and security features help AMD take share from rival Intel, today’s gains could be just part of a potentially far larger upward move in AMD’s stock price in the months ahead.
Investors will get an update on AMD’s current sales trends and future growth expectations when it reports its second-quarter financial results on July 28.
Joe Tenebruso has no position in any of the stocks mentioned. The Motley Fool recommends Intel. The Motley Fool has a disclosure policy.
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