AMD Stock Dips Despite CEO’s Tesla Meet, Automotive Partnerships Remain Key
Shares of Advanced Micro Devices (AMD) closed lower on Wednesday, following a broader tech sector downturn triggered by recent earnings reports from major players like Tesla Inc (TSLA) and Alphabet. The drop came despite CEO Lisa Su‘s recent public appearance at a Tesla event, highlighting the growing importance of the automotive sector for AMD.
Key Takeaways:
- AMD fell on Wednesday, mirroring a broader tech sector decline.
- Su’s Tesla appearance, while likely just a speaking engagement, could signal future partnerships.
- AMD’s automotive business is a key growth driver, as the sector witnesses rapid expansion.
- AMD’s automotive revenue is not broken out separately, making it difficult to gauge the sector’s impact on the company’s financials.
- AMD’s upcoming second-quarter earnings report on July 30 could provide more clarity on the company’s performance in the automotive sector.
Su’s Tesla Visit Sparks Speculation
Su, in a tweet, shared pictures from a Tesla event she attended, noting she had "great time spending time with the Tesla team talking about AI, leadership and more!". This meeting, likely more focused on Su’s role in the tech space than collaborations, could be significant considering AMD’s existing partnerships with Tesla.
AMD lists Tesla as a partner on its website, highlighting the use of AMD Ryzen Embedded APUs and RDNA2-based GPUs for powering the infotainment experience in the new Tesla Model S and Model X, including support for AAA gaming.
While Su’s appearance may not signify immediate collaborations, it serves as a reminder of the existing ties between AMD and Tesla, and the potential for future partnerships.
The Growing Importance of Automotive for AMD
AMD is one of many semiconductor companies vying for a piece of the rapidly growing automotive market. Earlier this year, Tesla CEO Elon Musk revealed that the electric vehicle giant planned to purchase chips from AMD to further its Artificial Intelligence (AI) initiatives, further solidifying AMD’s position in this space.
AMD offers a diverse range of products for automobiles, including driver monitoring systems, in-cabin monitoring systems, and driver information systems among others. While the automotive industry represents a significant growth area for semiconductor companies like Qualcomm Inc (QCOM), AMD’s lack of a specific breakdown for its automotive revenue makes it difficult to assess the sector’s impact on the company’s financials.
However, with new automotive-related products launched earlier this year, AMD is pushing to solidify its presence within this lucrative market.
AMD’s Upcoming Earnings Report – A Key Indicator
AMD will release its second-quarter earnings report on July 30 after market close. Analysts are expecting the company to report revenue of $5.73 billion and earnings per share of 68 cents, compared to $5.36 billion and 58 cents respectively during the same period last year.
While the market awaits the earnings report, the upcoming release could shed light on the company’s performance within the highly competitive automotive market and provide further insights into AMD’s future collaborations with companies like Tesla.
As the semiconductor industry continues its expansion within the automotive space, AMD’s strategy, and its collaboration with key players like Tesla, will be crucial in determining its future success in this growing market.
