Advanced Micro Devices (NASDAQ:AMD) stock was a big winner in 2023’s first half, though this doesn’t guarantee strong returns as the year ends. AMD recently introduced some powerful processors, including for PCs. After a rough 2022, it’s difficult to predict whether the PC market will recover.
AMD will have to deal with competition from a rival tech-component maker that you might not have considered. Some investors might find reasons to expect growth and good long-term value from AMD.
Potential AMD Stock Catalyst: Powerful New Processors
If there’s one thing you can count on, it’s that AMD will always roll out impressive new processors. The company’s MI300 chips are already well known and respected, as they can handle power-intensive AI applications.
AMD’s AI-compatible processors aren’t just for smartphones. For example, the company recently introduced its Alienware m18 laptop lineup, which features the new AMD Radeon graphics processing units. Notably, AMD reports that these Alienware laptops feature new AI accelerators that are specifically “optimized for the latest AI workloads.”
Plus, AMD recently unveiled its Ryzen Threadripper 7000 and PRO 7000 WX-Series Processors. If there’s a PC market recovery, AMD could generate robust revenue from this intriguing product line. The two newly introduced Threadripper series processors are for desktops and workstations, and they can handle complex AI workloads.
Could This Competitor Cause Problems for AMD?
Here’s a question to consider. Which competitor could threaten to crowd AMD out of the PC processor market in 2024? I’ll bet you didn’t say Qualcomm (NASDAQ:QCOM).
Yet, a Barron’s article suggests AMD needs to “look out” because Qualcomm is introducing a new, AI-capable chip for PCs. It’s called the Snapdragon X Elite.
This entrant into the PC chip war may be too little, too late for Qualcomm. AMD was far ahead of the curve, as the company has been developing AI-compatible components for PCs and laptops since January, at least, if not earlier than that.
As you may be aware, we’re not particularly bullish about Qualcomm. AMD is several steps ahead of Qualcomm, as AMD is using strategic acquisitions and value-added investments to bolster its status as a tech-sector leader and innovator.
AMD Stock: Consider Your Position Size
Truly, AMD and its investors do not need to worry about Qualcomm. Still, AMD will have to deal with competition from other PC chip makers. In addition, if the PC market slows in 2024, AMD might not generate much revenue from its Threadripper processors.
In other words, AMD should fare reasonably well but there are risks to consider. Therefore, if you’re going to take a position in AMD stock, don’t go overboard. Moderate position sizing will help to safeguard your portfolio against downturns while allowing you to add AMD shares if a good opportunity arises.
On the date of publication, neither Louis Navellier nor the InvestorPlace Research Staff member primarily responsible for this article held (either directly or indirectly) any positions in the securities mentioned in this article.
