7. Advanced Micro Devices, Inc. (NASDAQ:AMD)
Number of Hedge Fund Holders: 124
Advanced Micro Devices, Inc. (NASDAQ:AMD) ranks seventh on our list for its contributions to the AI industry. The semiconductor and IT company is behind the AMD Instrict MI300 Series accelerators, which are capable of managing complex AI workloads. These accelerators have high bandwidth memory and a huge memory density. The company’s efforts in AI do not stop here. On June 19, Advanced Micro Devices, Inc. (NASDAQ:AMD) announced the launch of an AI-backed smart parking solution for Sun Singapore Systems Ltd, one of the biggest smart parking solutions providers in Singapore. The new AI-based solution improves vehicle license plate recognition accuracy, parking spot vacancy detection, and accident detection.
The company is disrupting a wide array of industries using AI. The company logged $5.5 billion in revenue in the first quarter of 2024. Data center revenue expanded by 80% year-over-year and 2% from the previous quarter to reach $2.3 billion. The growth in data center revenue was driven by shipments of the AMD Instinct MI300X GPU and sales of its CPU. AMD’s MI300 became the fastest product to reach $1 billion in sales in less than two quarters. Based on current results, AMD raised its GPU sales forecast to $4 billion for the year from $3.5 billion guided in January. AMD’s chips are also a first choice among tech giants. Microsoft, one of the biggest technology companies, recently added AMD AI chips to its computing products.
Overall, at the close of Q1 2024, 124 hedge fund investors held stakes worth $15.63 billion in AMD. Of those, Ken Fisher’s Fisher Asset Management was the highest stakeholder with a position of $5.21 billion.
Here are some comments about AMD from Meridian Funds Q4 2023 investor letter:
“Advanced Micro Devices, Inc. (NASDAQ:AMD) is a global semiconductor chip maker specializing in central processing units (CPUs), which are considered the core component of most computing devices, and graphics processing units (GPUs), which accelerate operations running on CPUs. We invested in 2018 when it was a mid-cap value stock plagued by many years of underperformance due to lagging technology and lost market hi share versus competitors Intel and Nvidia. Our research identified that changes and investments made by current management under CEO Lisa Su had, over several years, finally resulted in compelling technology that positioned AMD as a stronger competitor to Nvidia and that its latest products were superior to Intel’s. We invested on the the belief that AMD’s valuation at that that time did not reflect the potential for its technology leadership to generate significant market share gains and improved profits. This thesis has been playing out for several years. During the quarter, AMD unveiled more details about its upcoming GPU products for the AI market. The stock reacted positively to expectations that AMD’s GPU servers will be a viable alternative to Nvidia. Although we pared back our exposure to AMD into strength as part of our risk-management practice, we maintained a position in the stock. We believe AMD will continue to gain share in large and growing markets and is reasonably valued relative to the potential for significantly higher earnings.”
