Company Description:

Advanced Micro Devices, Inc. is a global semiconductor company. The Company’s products include x86 microprocessors (CPUs), accelerated processing units (APUs), discrete graphics processing units (GPUs), semi-custom System-on-Chip (SOC) products and chipsets for the personal computer (PC), gaming, datacenter and markets.
The Company's segments include the Computing and Graphics segment, and the Enterprise, Embedded and Semi-Custom segment. The Computing and Graphics segment primarily includes desktop and notebook processors and chipsets, discrete and integrated graphics processing units (GPUs), data center and professional GPUs and development services.
The Enterprise, Embedded and Semi-Custom segment primarily includes server and embedded processors, semi-custom SoC products, development services and technology for game consoles

Company Product Overview:

AMD Server Share Gains Continue: AMD's dual socket server rev share increased by 84bps QQ to 12%, leveling off after gaining 300bps QQ in 1Q21. We expect AMD share gains to exceed 150bps a quarter for the next 4-to-8 qtrs.
Notebook ARMageddon; AMD Share Gains: ARM is now 8% of total NB unit share, up 153bps QQ; split 70/30 between Apple MacBooks and Chromebooks. AMD's NB share increased 188bps QQ to 20% unit share and revenue share increased by 169bps to 15%.
Desktops: AMD lost 165 bps QQ on unit share and 157 bps QQ on rev share, driven by a 45% QQ unit decline in older generation Vermeer CPUs (based on Zen 2 micro architecture). AMD continued to ramp its Zen 3 based Matisse CPUs with unit growth of 14% QQ. In 2Q21, ARM makes up 1.8% share in desktops up from 0.6% in 1Q21.

Computing and Graphics net revenue of $6.4 billion in 2020 increased by 37%, compared to $4.7 billion in 2019, primarily as a result of a 37% increase in unit shipments and a 2% increase in average selling price. The increase in unit shipments was primarily due to higher demand for our Ryzen processors. The increase in average selling price was primarily driven by a richer mix of client processors from higher sales of our Ryzen processors, which have a higher average selling price, partially offset by lower average selling price for our Radeon products due to product cycle timing.

Inventory Concerns Dissipate: While inventory builds in C1Q raised concerns as days increased 26 days q/q – AMD reported inventory days down 24 days q/q as builds supported multiple product ramps.
IP Value Remains Uncertain: While AMD IP has significant value, we are still unclear how AMD fully monetizes said value as it continues to struggle with scale challenges. While AMD cap of $14 bb is enticing relative to NVDA at $98 bb and INTC at $165 bb – risks include subscale economics, even against aggressive share gains assumptions, leaving us at a Neutral rating
AMD rely on third parties to manufacture our products, and if they are unable to do so on a timely basis in sufficient quantities and using competitive technologies, our business could be materially adversely affected.
If AMD lose Microsoft Corporation’s support for our products or other software vendors do not design and develop software to run on our products, our ability to sell our products could be materially adversely affected