$49 billion. This is the sum invested last week by AMD as part of its takeover of Xilinx, a Californian semiconductor giant initially specializing in programmable SoCs, but now very diversified. This acquisition allows the market capitalization of AMD to soar to the tune of 198 billion dollars, thus exceeding that of its rival Intel (193.70 billion as of February 17). A first in the history of the two firms.
This increase in AMD’s valuation is also the consequence of a number of shares which has greatly inflated following the takeover of Xilinx: 1,628 billion against around 1,200 billion previously.
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The valuation of AMD and Intel still very far from approaching that of Nvidia
Still, with this new valuation, it is also the expectations of investors who are revised upwards vis-à-vis the firm of Lisa Su. As the specialized site points out Guru3D, the acquisition of Xilinx offers hope for greater growth potential thanks to greater diversification. It must be said that until now AMD was mainly specialized in the design of processors and graphics cards for laptops, desktops and servers. It should also be remembered that on the x86 CPU market (AMD’s core business) the firm only occupies about a third of the market share. The rest being controlled by Intel, recalls Guru3D.
For AMD, the whole issue of the acquisition of Xilinx is therefore to extend the field of possibilities… and to establish itself in other sectors of activity. Getting hold of Xilinx is therefore a malignant move by AMD. This is indeed a jack of all trades. The brand has notably been able to establish itself in the sectors of 5G equipment, the Internet of Things, but also in the field of technologies dedicated to autonomous vehicles. Xilinx is also very active in the chips and embedded devices sector, and in the network device market. So many circles in which AMD will now also be present, at least indirectly.
Note that it is this drive towards diversification that has allowed Nvidia to reach its current market capitalization, estimated at $662 billion. AMD and Intel are far from it. As a reminder, the GPU giant has invested in the field of AI and neural networks, two high-growth sectors.