Advanced Micro Devices, Inc. (NASDAQ:AMD) stock continues to rise as Alphabet Inc (NASDAQ:GOOGL) selects AMD chips to be used in Google’s cloud-computing platform server GPUs starting next year.
The Google deal was a big win for AMD stock as the fight for chip maker dominance continues, mainly between AMD, NVIDIA Corporation (NASDAQ:NVDA), and Intel Corporation (NASDAQ:INTC).
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Nvidia was the only one of the three vendors to show gains in both quarter-to-quarter and year-over-year in Q3. (Source: “Nvidia: Q3 One of The Best in Their History in GPU Sales, Says Jon Peddie,” Barron’s, November 17, 2016.)
NVDA stock also had a leg up on AMD stock by providing chips to major corporate clients such as Amazon.com, Inc. (NASDAQ:AMZN) and Microsoft Corporation (NASDAQ:MSFT), among others. AMD stock is looking for this Google deal to help level out the playing field in the chip wars. New demand in fields like cloud computing, autonomous driving, and artificial intelligence has only intensified this long AMD-Nvidia rivalry. (Source: “AMD Extends Google Deal Breakout; 4 Chip Stocks In Or Near Range,” Investor’s Business Daily, November 18, 2016.)
The Google deal announcement helped cap off AMD stock’s great week as it reached a five-year high, gaining another three percent on Friday. That caps a week-long gain of over 30% for the company.
Many of these tech stocks had taken a hit since the election of Donald Trump, but most have since rebounded, having a pretty solid November, so far. NVDA stock has jumped by 40% since late October. As the technology requiring these processing chips expands, the industry is bound to see a steady rise in the market, barring any unforeseen events.
Credits: Flickr.com/KevinLawver
Of course, the tech-friendly nature of President-elect Trump is still questionable as he has stated his desire to put emphasis on infrastructure spending and manufacturing jobs, saying little about the tech industry going forward.
At the very least, there will always (or at least for the foreseeable future) be computers. As long as there are computers, they will need these chips to run.
Keep an eye on AMD stock and NVDA stock to see just where the current trends will take these two storied and well-respected companies.
