Advanced Micro Devices (NASDAQ:AMD) is further solidifying its presence in the enterprise data center domain by capitalizing on the capabilities of fourth-generation EPYC CPUs in conjunction with Pensando data processing units (DPUs). With a year-to-date return of 67.1%, AMD has surpassed the growth of the Zacks Computer & Technology sector, which stands at 32.4%. This exceptional performance is attributed to AMD’s robust product portfolio.
At the recent VMware Explore 2023 event, AMD showcased the impressive potential of combining a fourth-generation EPYC 9654 CPU with a Pensando DPU. This collaboration resulted in an astounding 3.3-fold enhancement in Redis application performance and a substantial 1.75-fold increase in aggregate network throughput when compared to a fourth-generation EPYC system equipped with standard NICs.
Furthermore, servers featuring dual fourth-generation EPYC 9654 CPUs exhibited up to 35% fewer servers required in a setup running 2000 virtual machines (VMs) in contrast to 2P Xeon 8490H-based servers from Intel (NASDAQ:INTC). The synergy among EPYC CPUs, Pensando DPUs, and adaptive computing products is bolstering AMD’s reputation as a preferred solution for enriched virtualized environments.
The ongoing collaboration with VMware (NYSE:VMW) is facilitating enhanced efficiency and agility for customers embarking on their digital transformation journeys. By delivering a performance surge of 1.7 times through EPYC CPUs combined with 2P EPYC 9654 CPUs compared to 2P Intel Xeon 8490H-based servers running VMmark, AMD is capitalizing on the superior performance of EPYC CPUs to offer groundbreaking solutions that promote data center consolidation.
As data center applications become more intricate, the emergence of AMD Pensando DPUs serves as a viable solution for offloading infrastructure services from CPUs, thereby liberating crucial work cycles. Powered by EPYC CPUs and Pensando DPUs, systems fueled by VMware vSphere 8 provide a dependable foundation for efficiently running a diverse range of mission-critical workloads, ensuring performance, efficiency, and flexibility. AMD’s innovations within the data center space, alongside VMware-powered systems, empower IT leaders to elevate the management and security of enterprise applications, marking the advent of a transformative era of digital progress.
Robust Partner Ecosystem Bolsters AMD
AMD benefits from a robust partner ecosystem that includes Microsoft, Amazon Web Services, Alibaba, and Oracle. These key cloud providers adopted Genoa during the second quarter of 2023. Furthermore, the growing adoption of fourth-generation EPYC CPUs by enterprises augments the company’s prospects.
In the second quarter of 2023, the uptake of fourth-generation EPYC CPUs gained momentum, with revenues nearly doubling sequentially. Cloud providers expanded their deployments to support internal infrastructure and public instance offerings. Presently, there are over 670 publicly available AMD-powered cloud instances, and this number is projected to grow by 30% to 900 by the end of 2023, largely driven by Genoa adoption. Additionally, the introduction of Bergamo is significant, as prominent server providers like Dell, HPE, Lenovo, and Supermicro are poised to unveil new Bergamo-based platforms in the third quarter. These factors are anticipated to bolster AMD’s prospects in the immediate future. The company’s third-quarter 2023 revenue outlook is approximately $5.7 billion (+/-$300 million), representing year-over-year growth of 2.5% and sequential growth of 6.5%.
AMD also anticipates growth in its Client segment, partially offset by declines in the Gaming and Embedded segments. Sequentially, revenues from the Client and Data Center segments are expected to experience double-digit growth, while revenues from the Gaming and Embedded segments are projected to decline.
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