AMD's stock is on the rise because of Wall Street's faith in Jaguar and hUMA. But are two technological wins enough to keep the company afloat?
AMD’s stock had a very good week last week.
The underdog chipmaker’s shareprice was flirting with the $4 mark, as it hit a high of $3.79 mid-way through Friday’s trading day before resting at $3.60. This is up from $2.65 when the week began, and the stock’s 52-week low of $1.71 from November 2012. Considering these numbers AMD’s stock ended the week with a gain of 36.4%, returns not seen since the company was looking down at Intel as the inferior chipmaker.
What does this rally mean? Wall Street has faith in AMD, particularly AMD’s upcoming Jaguar architecture and heterogeneous Uniform Memory Access “hUMA” technology.
A Jaguar in every living room
It isn’t new news that AMD’s Jaguar architecture, the successor to its popular Brazos line, will be powering the next-generation Xbox and Playstation.
Having Jaguar architecture in both next-generation game consoles would be a license to print money for the company as AMD. It also gives AMD incredible clout in defining the next generation of API standards; developers will be lining up to consult with AMD on how to make their games look the best on the consoles of next. But Jaguar is also something more, and something Intel hasn’t done. Jaguar is the first step towards heterogeneous computing, an evolution towards a totally integrated CPU and GPU.
Better living through hUMA
The ability to effectively integrate the GPU and CPU, eliminating the bottlenecks of GPGPU (General Purpose GPU) computing is a bridge that only AMD has been able to cross. While Mark Cerny PlayStation 4’s lead architect Mark Cerny let out a few spoilers of the existence of such a heterogeneous architecture existing on AMD’s hardware a few weeks ago, it wasn’t until last week that AMD officially announced hUMA for this summer’s upcoming Kaveri core.
Considering market demands, growth is not necessarily going to be in high-power high-cost chips. Should hUMA work in the real-world as advertised, it will allow the company to attain some serious growth in the mobile and tablet marketplace.
Caution going forward
While hUMA and Jaguar’s place in the next-generation game consoles can do a lot to drive the company forward, it still has to contend with a collapsing PC market. However, this collapsing market has hurt its rival Intel more than it has hurt AMD. Although AMD’s stock has jumped 50% over the past 12 months, it is still down 50% for past year.