Shares of Advanced Micro Devices (NASDAQ: AMD) grew by another 6.2% on Monday, closing at a historic high of $90.82. The prominent semiconductor manufacturer’s success can be largely attributed to the scope and timing of its announcements compared to other manufacturers.
The timing of AMD‘s latest stock bump coincides with the entry-level GPU it quietly announced to compete with Nvidia’s GTX 1650. The fact this release came with no warning is attention-catching, and since the news cycle tends to operate by being a race to “break” the story, people were sharing the news rapidly from the onset, and inevitably stockholders were among the first to find out.
AMD has shown steady growth in the NASDAQ over the past year, with a heated battle for supremacy between it and Intel between April and July. August onward saw a surge in growth, which seems to be inversely correlated to Intel’s stock around the same time. This could have to do with a marketing tactic AMD employed in July, giving out Assassin’s Creed Valhalla free with select processors. A recent Reddit thread pointing out a nod to Norse mythology in the game’s trailer may have tangentially stirred interest in the manufacturer by this relation.
Sticking to its promised release dates for the PS5 and Xbox Series X undoubtedly helped its case. Most companies have been running into workflow problems related to the COVID-19 pandemic, so managing to stay on schedule regardless is an encouraging sign. Working from home is on the uptick, so there is demand from content creators both large and small for upgraded tech. Media production is going to be a huge market for parts manufacturers going forward.
Consumers in many markets will find themselves financially strained in 2021. Nearly half of gamers play on PC, which means the market is more or less anybody’s game when it comes to hardware, and consumers are likely to start carefully weighing performance with price when shopping for new parts. AMD is already boasting more affordable prices than Nvidia’s graphics cards, so it will have to continually prove its hardware is at least as reliable as the competitor’s equivalents entering into the Holiday season.
This dramatic uptick has put a lot of attention on AMD, and how it handles itself in the coming months will be the difference between continuing growth, a leveling off like Take-Two Interactive saw after its record profits last month, and an Icarus-style burnout. Its competitors have been handling their own crises in both supply and demand over the past several weeks, but there is no telling when factors will change around these globally traded companies.
Source: NASDAQ
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