Advanced Micro Devices AMD has been reportedly developing advanced high-performance graphics card, in a bid to challenge NVIDIA’s NVDA dominance in the high-end GPU market. The GPU is reportedly dubbed to be, "NVIDIA Killer."
Rumors have been doing the rounds ever since the company’s CEO, Dr. Lisa Su, mentioned about unveiling “Big Navi” soon.
In fact, tech enthusiasts are of the opinion that the latest filing with Eurasian Economic Commission for Radeon RX 5950XT and other cards, on Jan 14, validates the buzz around the launch of the new chip.
Per Tech Radar report, the new graphics card is touted to be 30% faster than NVIDIA's RTX 2080 Ti.
Per Twitter user, KittyCorgi, cited on various sources, AMD Radeon Navi 21, features 80 Compute Units, hardware Ray Tracing and offers 2X faster performance over the company’s Navi 10 or RX 5700 XT.
We believe that the robust features of the new GPU, rumored for launch in 2020, positions AMD well to capitalize on the high-end graphics card market.
Coming to price performance, shares of AMD have returned 158.3% in the past year, significantly outperforming the industry’s rally of 50.6%.
GPU Initiatives Favor Growth Prospects
AMD’s expanding GPU portfolio catering to every price points is a threat to NVIDIA’s dominance.
Notably, per third-quarter 2019 JPR data, AMD’s market share in discrete GPU shipments came in at 27.08%, up from 25.72% in third-quarter 2018. Consequently, NVIDIA’s market share declined to 72.92% from 74.28% in the same period.
Markedly, AMD’s GPUs based on Navi gaming architecture, are compliant with PCIe 4.0 and offer high-speed GDDR6 memory. The company claims that RDNA offers higher performance on a per-clock and per-watt basis over AMD’s prior Graphic Core Next (GCN) architecture.
Moreover, the company’s GPUs integrated with Radeon Image Sharpening (RIS), enable high-resolution display and provide immersive 1440p gaming experience. Meanwhile, FidelityFX capability allows developers to improve gaming with robust post-process effects. Further, Radeon Anti-Lag functionality reduces input lag time by approximately 31%.
According to Mordor Intelligence data, the GPU market is set to hit $104.71 billion by 2025, from $20.62 billion valuation in 2019, at a CAGR of 31.1% from 2020 to 2025. The upside is likely to be driven by constant changes in graphic games and advancement in augmented reality (AR), virtual reality (VR) platform as well as AI.
Advanced Micro Devices, Inc. Price and Consensus
Advanced Micro Devices, Inc. price-consensus-chart | Advanced Micro Devices, Inc. Quote
Moreover, growth in the gaming hardware market is driving demand for GPUs as well, which is a tailwind for AMD. We expect that the efforts undertaken by AMD in the GPU arena to boost business prospects.
Intense Competition from NVIDIA: A Major Headwind
Although AMD’s strengthening 7nm-based portfolio holds promise, intense competition from NVIDIA, which has a competitive edge in the GPU market on the back of its robust drivers, remains a major concern.
Moreover, NVIDIA is enabling ray tracing backup to several GeForce GTX GPUs, including recently launched Turing-based gaming cards, which is a key challenger for AMD. NVIDIA’s latest GPUs make real-time ray tracing more accessible and deliver faster performance.
NVIDIA Corporation Price and Consensus
NVIDIA Corporation price-consensus-chart | NVIDIA Corporation Quote
NVIDIA’s Turing GPU and its real-time ray tracing technology are witnessing a massive adoption. Markedly, the company is also benefiting from the adoption of real-time ray tracing in the professional visualization markets.
Both, AMD and NVIDIA currently carry a Zacks Rank #3 (Hold).
Some better-ranked stocks in the broader technology sector are Keysight Technologies KEYS and Garmin GRMN, both flaunting a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Long-term earnings growth rate for Keysight and Garmin is currently pegged at 9.1% and 7.35%, respectively.
Just Released: Zacks’ 7 Best Stocks for Today
Experts extracted 7 stocks from the list of 220 Zacks Rank #1 Strong Buys that has beaten the market more than 2X over with a stunning average gain of +24.6% per year.
These 7 were selected because of their superior potential for immediate breakout.
See these time-sensitive tickers now >>
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
Keysight Technologies Inc. (KEYS) : Free Stock Analysis Report
Garmin Ltd. (GRMN) : Free Stock Analysis Report
NVIDIA Corporation (NVDA) : Free Stock Analysis Report
To read this article on Zacks.com click here.
Zacks Investment Research