By Senad Karaahmetovic
A KeyBanc analyst has raised estimates for AMD (NASDAQ:AMD) on the back of the strong cloud growth strength seen in July.
Overall, cloud growth soared 4% m/m and +25% y/y vs. +1% m/m and +23% y/y in June. AMD is seen as the biggest beneficiary as its Milan drove “significant growth at GCP and AWS.”
“AMD processor instances grew +21% m/m, +145% y/y, compared with June (+2% m/m, +110% y/y), led by Milan (+39% m/m), particularly at GCP and AWS. The prior generation, Rome, also posted +8% growth m/m, benefiting from Azure deployments,” the analyst said in a client note.
Data center estimates are now raised to $6.42 billion from $6.27 billion, leading to the increase of 2022E and 2023E EPS to $4.45 and $4.93 from $4.40 and $4.83, respectively.
As far as Intel (NASDAQ:INTC) is concerned, the results were seen as “neutral” as instances grew modestly.
NVIDIA's (NASDAQ:NVDA) earnings also rose “solidly” in the last few months, led by Ampere and Turing. The chipmaker is due to report earnings on Wednesday after close and the analyst expects results that are “in line” with the Company's negative preannouncement on August 8.
On a more positive note, the analyst sees evidence that FQ2 could market the bottom for NVDA shares on the back of these 3 de-risked gaming estimates, pull-in of the launch of RTX40 into C4Q, and strong data center demand.
“We remain Overweight and would be buyers of NVDA,” he added in a separate note.