Hi there! Before we dive into AMD‘s rich history and how the stock has done over the years, let‘s start with the key question – how much is AMD stock right now? As of November 16, 2022, AMD‘s stock price closed at $71.37 per share. This reflects a 55% drop from its all-time high of around $155 in November 2021.
Now, let‘s take a deeper look at AMD‘s story and what‘s driving the stock today.
The Evolution of AMD: From Humble Beginnings to Industry Leader
AMD has come a long way over the past 50+ years. Founded in 1969 as a small Silicon Valley startup, AMD began by selling logic chips. In the 1970s and 1980s, AMD became a second source manufacturer of microprocessors originally developed by larger companies.
AMD began designing its own x86 CPUs in 1991. The K5, launched in 1996, was AMD‘s first in-house x86 processor. While the K5 struggled, it paved the way for AMD‘s rise to prominence.
The late 1990s saw greater success for AMD after launching the K6 line and the ground-breaking Athlon architecture in 1999. AMD finally had competitive CPUs that could challenge industry leader Intel.
AMD continued battling Intel through the 2000s with well-regarded CPUs like the Athlon 64. By mid-2006, AMD‘s stock price exceeded $40 per share for the first time as the company reached nearly 25% market share in PCs.
However, AMD hit difficult times after that peak, hurt by issues like manufacturing delays. AMD‘s stock plummeted from around $40 in 2006 to under $2 per share by early 2009.
After surviving the global financial crisis, AMD spent the early 2010s rebuilding. The company remained stuck below $10 per share. But savvy investments in graphics chips and mobile processors laid the foundation for AMD‘s upcoming surge.
AMD‘s Remarkable Comeback Beginning in 2016
The launch of AMD‘s Zen microarchitecture in 2017 marked the company‘s dramatic comeback. Zen powered AMD‘s hugely successful Ryzen CPUs and Epyc server processors. These new products vaulted AMD‘s performance ahead of Intel after years of trailing behind.
AMD‘s first generation Ryzen and Epyc products were just the beginning. The chart below shows how AMD‘s desktop CPU market share has grown vs. Intel over the past 6 years.
Data source: PassMark
As this chart illustrates, AMD‘s share of the desktop CPU market has nearly quadrupled from around 15% in early 2017 to over 60% as of late 2022. Their smart technology investments and flawless execution began to pay off.
Bolstered by Ryzen and Epyc sales, AMD‘s stock price entered a massive growth trajectory starting in 2016. AMD stock surged from around $2.50 in early 2016 to over $30 by 2018. Second generation Ryzen and Radeon products accelerated the stock‘s climb to $35 by mid-2019.
Then AMD‘s share price utterly exploded. Major product launches like 3rd generation Ryzen and Radeon RX 5000 GPUs drove AMD to all-time highs throughout 2020 and 2021. By November 2021, AMD‘s stock closed above $150 for the first time ever – a 6,000% return from lows just 5 years prior!
Why is AMD‘s Stock Down Now?
As discussed earlier, AMD stock has fallen over 55% from its November 2021 peak. Let‘s examine the key factors behind this decline:
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Weakening PC demand – Research firms IDC and Gartner reported double-digit PC shipment declines in Q3 2022 as demand softened globally. High inflation has squeezed consumer spending.
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Rising interest rates – Central bank rate hikes are making investors less willing to take risks, especially in growth sectors like technology.
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Supply chain woes – Shortages of components like semiconductors have hampered production across the tech industry.
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Recession fears – Sentiment has dropped as analysts warn major economies may enter a recession soon. That would further dampen PC and electronics sales.
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Geopolitical instability – Events like the war in Ukraine have disrupted supply chains and worried investors.
This "perfect storm" of negative developments has driven AMD‘s valuation down aligned with the overall market selloff. But the question for investors now is what‘s next?
AMD‘s Future Prospects and Competitive Advantages
Despite current headwinds, AMD retains key strengths that should enable future growth:
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Technology leadership – AMD‘s latest Ryzen 7000 CPUs and Radeon 7000 GPUs again outpace competitors on performance benchmarks. The company has mastered advanced chipmaking.
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Market share gains – As seen in the earlier chart, AMD continues to steadily gain share against giants like Intel and Nvidia in PCs and gaming. More high-profile OEM wins will accelerate this.
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Execution – AMD has delivered an impressively consistent cadence of new products matching their public roadmaps. Their engineering prowess is world-class.
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Financial strength – While Q3 2022 profit declined due to the downturn, AMD still generated $1.1 billion in free cash flow. The balance sheet remains rock solid.
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Growth avenues – AMD is expanding into data centers, machine learning, and other emerging sectors to broaden their revenue mix beyond PCs.
According to Mercury Research, AMD achieved record quarterly server CPU revenue in Q2 2022, with over 10% market share. Epyc processor adoption is rising among major cloud providers like AWS and Microsoft Azure. AMD‘sInstinct GPU accelerators for AI and ML are also gaining traction.
CEO Lisa Su commented on AMD‘s Q2 2022 earnings call: "We delivered our 8th straight quarter of record server revenue, based on expanded adoption of 3rd Gen EPYC processors by cloud, enterprise and HPC customers."
While AMD faces risks like data center competition from Intel‘s Sapphire Rapids, their technology and execution have earned trust that they can compete.
Based on these strengths, most analysts remain bullish on AMD‘s long term prospects after the stock‘s correction.
According to 32 analysts surveyed by MarketWatch, the average AMD stock price target is $98.78. That represents nearly 40% upside from current levels. While markets could stay volatile short term, many experts see sizable gains for AMD in 2023 and beyond.
The Road Ahead – What to Watch with AMD
In the coming months, here are key things investors should monitor that could impact AMD‘s stock:
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Q3 2022 earnings – AMD reports third quarter results on November 1. Watch for PC market signals and demand trends.
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New product sales – Early benchmarks show AMD‘s Ryzen 7000 and Radeon 7000 dominate. Strong sales here would be bullish.
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Data center progress – Track AMD‘s next generation Epyc "Genoa" and "Bergamo" uptake among cloud vendors.
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Macro environment – Chip demand often follows broader economic conditions. Signs of recovery would help AMD.
While nothing is guaranteed, I believe AMD has strong prospects for long term growth. The company has proven its ability to disrupt entrenched competitors through savvy technological innovation. AMD‘s future remains bright.
So in summary, AMD‘s stock has taken shareholders on a wild ride – from under $2 in 2016 to over $150 in 2021, before plunging back below $100. Near term challenges have driven the stock down, but AMD is poised to capitalize on its competitive strengths when markets eventually improve.
For investors with a multi-year time horizon, buying AMD stock after its 50%+ drawdown could deliver strong returns. Of course, expect continued volatility along the way – that‘s the nature of the semiconductor industry and tech stocks overall. But AMD has carved out an enviable market position that should drive revenues, earnings and shareholder value higher over time.
Hope this gives you a comprehensive overview of AMD‘s stock price journey! Let me know if you have any other questions.