On Thursday, AMD surged another 7.86 percent, taking its stock to $31.82 by close of day. The stock has jump over 14 percent in the past week and is up over 40 percent since the start of the year. So, what exactly was the cause of Thursday's performance boost? Well, Morgan Stanley analyst Joseph Moore admitted that his bearish outlook on AMD had "obviously been the wrong call."
He added in an investor note that AMD has positive near-term catalysts that are playing in its favor and that its fundamentals for 2020 look sound. “The bottom line is that due to a combination of the way that AMD implements virtualization, NVIDIA's desire to pursue higher-margin GeForce Now-based implementations, and AMD’s relationships with console developers, AMD can be in a very strong position to benefit if these cloud-based gaming initiatives start to take off."
Moore also indicated that Intel is less of a competitive threat at this point, primarily due to the fact that the company is still undergoing processor shortages -- which are playing in AMD's favor -- and that its 10nm processor ramp is just now getting underway. Even though the shift to 10nm has been championed by those eagerly waiting for Intel to leave its well-seasoned 14nm process node behind, the first Ice Lake processors using 10nm are limited to low-power U-Series SKUs. We may not see a full-scale shift to 10nm for Intel's bread-and-butter processors in the consumer and enterprise sector until the 2020-2021 timeframe.
AMD’s steady CPU market share gains, its incoming crop of Ryzen 3000 desktop processors (capped off by the 12-core Ryzen 3900X, and potentially a 16-core beast), high-performance second-generation EPYC server processors, and its tight relationship with Sony and Microsoft in the console sector are looking like a winning combination so far.