AMD (NASDAQ:AMD)'s stock experienced a slight increase of around 1% following CFO Jean Hu's optimistic presentation at the Barclays (LON:BARC) 22nd Annual Global Technology Conference. Hu highlighted the company's significant market share gains in the server CPU market, which reached 34% in the last quarter, up from low single digits a few years ago. This growth was attributed to AMD's consistent focus on product innovation and execution across generations, from the first-generation Naples to the current fourth-generation family, Genoa, and the upcoming Zen 5, known as the Turin family product.
Hu also emphasized AMD's success in the PC market, with market share reaching 27% for desktops and 19% for mobile in the third quarter. The company's ability to work closely with customers and provide technology leadership was cited as a key factor in this progress.
Despite the positive developments, Hu acknowledged that AMD is still underrepresented in the enterprise server market compared to its cloud market presence. She outlined the different go-to-market strategies required for enterprise, where convincing each CIO of AMD's total cost of ownership (TCO) advantages is crucial. Efforts to increase field application engineers (FAEs) have led to double-digit growth in enterprise business for the last five quarters, and with the launch of the Turin product in Q4, AMD expects continued momentum into the next year.
Hu also addressed competition, stating that AMD assumes its competitors will perform well and focuses on maintaining its competitive edge and leadership. She mentioned that the transition to ARM-based PCs has not significantly impacted AMD, as customers are more concerned with performance and efficiency, areas where AMD has strong offerings.
In terms of the data center GPU market, Hu celebrated the growth from zero to an expected $5 billion in revenue for 2024, with a strong product lineup for 2025. The acquisition of ZT Systems is part of AMD's strategy to address system-level solutions and software investment, aiming to capture a significant portion of the AI infrastructure market.
Regarding the embedded business, Hu reported a bottoming out in Q3 and stabilization in Q4, with a gradual recovery expected in 2025. She also mentioned diverse design wins and a focus on mid-to-high-end FPGA solutions across various sectors.
Hu concluded by discussing AMD's operating model, indicating that R&D investment will continue aggressively to support multi-generational roadmaps and leadership, with opex growth expected to be less than revenue growth to leverage operating model efficiency.
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