AMD acquires Silo AI for $665 million to strengthen AI ecosystem

From Nasdaq: 2024-07-12 11:24:00

Zacks Equity Research analysts featured Advanced Micro Devices, NVIDIA, Microsoft, and Alphabet in the Analyst Blog. AMD is acquiring Silo AI for around$665 million in cash to strengthen its AI ecosystem, compete with NVIDIA, and target the growing demand for AI chip dominance.

Silo AI, based in Helsinki, offers end-to-end AI solutions, and AMD’s acquisition aims to close the technological gap with NVIDIA. The AI space is booming, with increased spending forecasted by Gartner and Deloitte. AMD’s recent portfolio expansions position it well to challenge NVDA in various markets, including data centers and consumer PCs.

However, AMD faces stiff competition from NVIDIA, potential challenges due to the macroeconomic environment and upcoming elections, and sluggish revenues in the Embedded and Gaming segments. Despite a Growth Style Score of D and a Value Style Score of F, AMD’s stock has outperformed the Zacks Electronics-Semiconductors industry in the past month.

AMD expects second-quarter 2024 revenues to grow by approximately 6%, with the Zacks Consensus Estimate for revenues at $5.71 billion and earnings at 66 cents per share. While AMD shares have grown over 14% in the past month, the fundamental challenges facing the company have resulted in a Zacks Rank #5 (Strong Sell). Investors are advised to exercise caution due to the uncertainties in the market.



Read more at Nasdaq: The Zacks Analyst Blog Highlights AMD, NVIDIA, Microsoft and Alphabet