U.S. markets closed
  • S&P 500

    3,719.04
    +71.75 (+1.97%)
     
  • Dow 30

    29,683.74
    +548.75 (+1.88%)
     
  • Nasdaq

    11,051.64
    +222.13 (+2.05%)
     
  • Russell 2000

    1,719.69
    +57.18 (+3.44%)
     
  • Crude Oil

    82.06
    +3.56 (+4.54%)
     
  • Gold

    1,669.20
    +33.00 (+2.02%)
     
  • Silver

    18.92
    +0.58 (+3.18%)
     
  • EUR/USD

    0.9732
    +0.0135 (+1.40%)
     
  • 10-Yr Bond

    3.7050
    -0.2590 (-6.53%)
     
  • GBP/USD

    1.0876
    +0.0145 (+1.36%)
     
  • USD/JPY

    144.1440
    -0.6470 (-0.45%)
     
  • BTC-USD

    19,534.91
    +472.88 (+2.48%)
     
  • CMC Crypto 200

    445.75
    +16.97 (+3.96%)
     
  • FTSE 100

    7,005.39
    +20.80 (+0.30%)
     
  • Nikkei 225

    26,173.98
    -397.89 (-1.50%)
     

AMD Pensando DPUs Help VMware Reduce Operational Costs

·4 min read

Advanced Micro Devices AMD recently announced that its AMD Pensando Distributed Services Card is selected as the first data processing unit (DPU) solution to support VMware’s VMW vSphere 8, also procurable from leading server vendors like Dell Technologies DELL, HPE and Lenovo.

With recent growth of data center applications in terms of scale and sophistication, the resulting workloads are mounting pressure on infrastructure services and crucial CPU resources to generate greater throughput of processed data. It is becoming very difficult to manage big data safely and fast in a cost-effective way. As a result, organizations are seeking IT infrastructure that is composable and delivers a cloud-like storage system for their voluminous data.

VMware is addressing this issue by building an IT infrastructure as a composable architecture which can offload infrastructure workloads such as networking, storage, and security from the CPU and free up valuable CPU cycles to be used for business operations and revenue generating applications.

The AMD Pensando DPU is at the core of this shift. In collaboration with VMware vSphere Distributed Services Engine, it is helping reduce operational costs by freeing up CPU resources and providing extra security by separating infrastructure services from server tenant workloads.

The recent collaboration with VMware will help AMD expand its operations in the high-growth markets like data center and phase itself out from the sluggish PC market, which is witnessing tepid demand.

Advanced Micro Devices, Inc. Price and Consensus

Advanced Micro Devices, Inc. Price and Consensus
Advanced Micro Devices, Inc. Price and Consensus

Advanced Micro Devices, Inc. price-consensus-chart | Advanced Micro Devices, Inc. Quote

AMD Diversifies Data Center Operations for Share Price Rally

AMD's shares have slumped 41% compared with the Zacks Computer and Technology sector's decline of 28.3% in the year-to-date period.

The fall in AMD’s share price was due to the rising geo-political tensions between the United States and China, the global supply-chain challenges that adversely impacted the semiconductor industry, the ongoing Russia-Ukraine war, rising inflation and interest rate hike by the U.S. Federal Reserve, which has caused the recent fall in PC demand as the market slips into recession.

Stiff competition from peers like NVIDIA NVDA and Intel also remains a concern.

NVIDIA is a dominant name in the data center, professional visualization and gaming markets where its peers are close on its heels. NVDA has been benefiting from the rapid proliferation of AI. The company has been expanding its base in untapped markets like climate science, energy research, space exploration and digital biology.

Intel is still leading name in the consumer PC market and is the major competitor of AMD in this segment. INTC is gradually reducing its dependence on the PC-centric business by transitioning to data-centric businesses such as AI and autonomous driving.

However, AMD which currently carries Zacks Rank #3 (Hold) has been gaining from its plans to form strategic partnerships and acquisitions with different companies to address new-high growth markets and enter the AI and AR spaces with its launch of various new products. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

AMD recently collaborated with Dell to launch the most powerful 17” AMD Advantage laptop — Alienware m17 r5 Gaming Laptop.

The recent collaboration will help AMD benefit from the rising gaming industry that will attain $545.98 billion by 2028, witnessing a CAGR of 13.20% between 2021 and 2028, according to Fortune Business Insights.

Also, AMD’s recent collaboration with VMWare is aiding in expanding its’ operational base in the data center business where it can cement its position with the acquisition of Pensando.

AMD completed the acquisition of Pensando for approximately $1.9 billion, which is expected to strengthen its technology portfolio and expand its rapidly growing data center business despite strong competition.


Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
 
Advanced Micro Devices, Inc. (AMD) : Free Stock Analysis Report
 
VMware, Inc. (VMW) : Free Stock Analysis Report
 
Dell Technologies Inc. (DELL) : Free Stock Analysis Report
 
NVIDIA Corporation (NVDA) : Free Stock Analysis Report
 
To read this article on Zacks.com click here.
 
Zacks Investment Research