AMD Stock : Is AMD a buy hold or sell?

AMD Stock : Is AMD a buy hold or sell?

Is AMD stock a buy hold or sell?

“Each of our businesses grew by a significant double-digit percentage year-over-year,” According to AMD Chief Executive Officer Lisa Su!

Furthermore, AMD’s business passed Wall Street analyst estimates for the 1st Fiscal Quarter by nearly 10%!

AMD CEO Lisa Su also said:

The chipmaker has reached a “significant inflection point.”
“Xilinx can’t be overstated,”… “It significantly expands our product and technology portfolio.”

From Xilinx, AMD receives field-programmable gate array. Also known as FPGA, chips configurable by a customer or a designer after the initial build of the chip. Lastly, those chips function as accelerators in data centers to boost computing power and improve power efficiency in existing physical spaces.

“Although the PC market has experienced some softness coming off of multiple quarters of near-record unit shipments, our focus remains on the premium gaming and commercial portions of the market where we see strong growth opportunities and we expect to continue gaining overall client revenue share,” CEO Su said on the conference call.

In conclusion, clearly AMD stock’s big bet on Data Centers has been a huge win for the business! Way to go Lisa Su!

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For more coverage on the Semiconductor Industry see our piece below:

Why Is There A Chip Shortage? COVID-19 has disrupted the US semiconductor industry chain. As a result goods and products both big and small have become hard to acquire for the consumer and prices have risen dramatically. Semiconductors have a delicate global supply chain dependent on a few key players. In, addition they rely on a smooth flow of goods and materials around the world which has not occured.

Clogged Ports

The port of Los Angeles, the largest port in the United States, is under constant pressure from incoming containers. Many dockyard workers became infected with COVID-19. And there was a shortage of labor.

The port is always heavily congested, and cargo piled up, slowing the arrival of large ships.

Slow Factories

In addition, the production of factory goods became severely affected.

A semiconductor consists of several steps: design, manufacture, test, and package. When problems arise with critical suppliers in the industry, the closed-test process can’t guarantee the availability of the chips, so it’s hard to ship them.

Chips affect the entire industrial chain.

Semiconductor supplies in the United States have been hit hard through this crisis. And the COVID-19 pandemic has had a severe impact on trade. The ports of Los Angeles and Long Beach, California, two of the nation’s busiest, saw double-digit growth, setting records.

According to the California Trucking Association (CTA) and the Port Trucking Association of America (HTA). Moreover, a large number of containers are stranded at Los Angeles and Long Beach. The two major shipping ports have been brought to a near standstill. This standstill has disrupted supply chains as imports surge. Moreover, our supply chains have a limited number of avenues for action. Most countries have a very limited number of ports for supplies.

In addition, there are about one-third fewer dockworkers on hand due to COVID-19 related problems. The workers fell out with the factory over labor. The dockworkers’ union announced a four-day halt to unloading at the port. Which has prevented dozens of cargo ships from entering and unloading outside the port.

Which is believed to be the worst port congestion since 2004.

Suez Canal

Beyond the port of Los Angeles, the blockage of the Suez Canal strained global supply chains.

The Suez Canal accounts for 30% of the world’s daily shipping container traffic according to data from Veiga. The blockage of the Suez Canal has caused a massive loss of global trade. Many ships have been delayed and have incurred additional expenses because they cannot pass.

Some ships circumnavigated the Suez Canal which necessitated longer voyages and associated costs for weeks.

The high price of relying on the Suez Canal affects the flow of goods to European markets. Much of Europe’s furniture and household goods are stuck in the canal, when these problems cannot be solved, prices start to rise.

COVID-19 has made supply chain production and acceptance difficult to resolve.

Taiwan Semiconductor

An outbreak of infections at Taiwan Semiconductor, the largest company in southeast Asia by market cap, also hit global trade. Taiwan Semiconductor makes chips for big tech companies. Taiwan Semiconductor has gigantic customers. Their customers are household names such as Apple and Qualcomm. And could lead to a further global shortage of chips.

Taiwan Semiconductor manufactures more than half of the world’s most advanced chip production.

But hundreds of employees tested positive for the virus. And hundreds of workers became in need of quarantine. Then the company slashed their revenue forecast for the month by a third.

In addition to Taiwan Semiconductor, other semiconductor companies reported large amounts of employees becoming infected with COVID-19.

Taiwan’s Pain

Moreover, the rising number of infections in Taiwan has sent the island’s capitalist markets convulsing. As a result many analysts worry that the chip crisis afflicting the global electronics industry will worsen. Furthermore, Taiwan Semiconductor is responsible for the packaging and for testing part of the chip production. As a result the shutdown of that part of the production has made downstream systems challenging to perform, which has caused massive shortages at large auto companies from Tesla to Ford.

Besides Taiwan, many semiconductor companies in Malaysia are also at risk of bankruptcy.

Moreover, in early June, malls and most businesses in Malaysia began to close, and the country went into lockdown. As one of the world’s semiconductor export centers, dozens of semiconductor companies have invested here over the last few decades. Lastly, Malaysia’s covid blockade has also hit the chip industry hard, with tough exporting procedures in place.

Conclusoin

In conclusion, while the COVID-19 pandemic has sent demand soaring in the electronics industry, the loss of chips has hobbled the entire industry. As a result, both production and supply of chips are struggling to keep up with existing demand.

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