AMD Fell 5% today

What’s all the fuss

Today as of 12:45 p.m. E.T. AMD’s shares were down 5.4%. Today it’s a down day for the market overall, with the Nasdaq Composite at a 1.8% decline.

At the same time, AMD said today it is investigating a possible data breach, and pressure from sagging GPU prices may also be contributing to today’s AMD sell-off. 

A bit of the tea

AMD said this morning it is looking into a claim by cybercrime group “RansomHouse”, which says it stole 450 GB worth of data (various network files and general company info) earlier this year thanks to weak password protection at the semiconductor company.

The other major concern is that GPU (graphic processing units) prices are going down fast,47% of AMD revenue during Q1 came from consumer-facing products, so a drop in demand and a drop in prices is concerning.

GPUs can be used to mine cryptocurrency, and with the crypto market at an all-time low, miners are filling the second-hand market with old GPUs making new ones less sought-after.

Is AMD in trouble?

The upshot for AMD is that consumer products are becoming a smaller portion of the business overall. The acquisition of industrial and enterprise chip designer Xilinx was completed earlier this year, creating new end markets for AMD to sell hardware to.

Also, its data center revenue is also booming. Its EPYC processors helped drive an 88% year-over-year increase in sales for AMD’s “enterprise, embedded and semi-custom” segment in the first quarter of 2022.