Verizon Provides Annual Revenue Increment Of $50 Million To Advanced Micro Devices (NYSE:AMD)

Boston, MA 10/11/2013 (wallstreetpr) – Last week Verizon announced two enterprise infrastructure-as-a-service offerings to compete with Amazon Web Services. The company is expected to provide an annual increment of around $50 million in revenue to Advanced Micro Devices (NYSE:AMD) as it chooses SeaMicro microservers to power these platforms. This also explains the earlier 2012 deal between SeaMicro and AMD when AMD bought the former surprising many. Verizon is exclusively using SeaMicro servers and storage hardware for its cloud computing service. The service would enable a new class of customers to begin outsourcing parts of their operations. This would be the biggest ever deal for SeaMicro.

Apart from SeaMicro, this would sustain AMD’s results as its PC market outperforms the company’s expectations with the ODM Notebook trackers indicating 7% units up. To add on, China has put on hold the ban on gaming console which showered a positive impact on the 2015 Xbox One and PS4 estimates. This reflects improvement in the growth prospects of the company in this division, raising SeaMicro estimates as also the gaming console estimates which results in greater channel build and higher TAM.

AMD may also have an opportunity for providing parts for the Microsoft “Bestpad” and Sony’s “Vita TV”. The console business which had exhibited disappointing margin profile can be expected to improve in the coming time. Also, as China announces free trade zone near Shanghai, it provides AMD the chance to provide two new sockets for the MS Xbox Bestpad and Sony Vita TV in addition to the expected rising estimates for Xbox and PS4 by the year 2015. Apart from the console business, AMD’s core business has been amidst a dissatisfactory PC market but the conditions seem to be stabilizing. The company has shifted its focus from PC environment to microservers, gaming APUs and embedded processors just in time.

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Published by Chris Brown

About Me: I have a Phd in Economics Gender: Male Interests: Playing games like cricket, volleyball Favorite Music: hip hop, rock, jazz

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