AMD preferred over Intel by BofA as earnings season gets underway
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Going into first-quarter earnings season, investment firm Bank of America said it prefers AMD (NASDAQ:AMD) over Intel (NASDAQ:INTC), as the company is likely to benefit from its Xilinx acquisition in the industrial and auto markets.
Analyst Vivek Arya, who has a buy rating on AMD (AMD) and an underperform rating on Intel (INTC), noted that even though the PC and data center spaces are troubled, AMD is likely to benefit more than Intel later this year, due to new products, including its Genoa server CPU.
"We believe AMD is overall better positioned given its high exposure to cloud vendors who should ramp up CPU/accelerator investments on AI tailwind," Arya wrote in an investor note "Its 5nm Genoa also enjoys process node advantage and core count leadership (better multi-threading performance) over âIntel 7â Sapphire Rapids, despite the latterâs AI performance claims."
A consensus of analysts estimate that AMD (AMD) earned 56 cents per share on $5.31B in revenue in the first-quarter. Conversely, they expect Intel (INTC) lost 14 cents per share on $11.22B in sales.
Arya added that even though Intel's (INTC) shares have jumped over the past several trading sessions, which some attribute to its portfolio for artificial intelligence, the company is likely to keep losing server market share to AMD (AMD) until at least 2025.
Arya lowered his 2023 estimates on Intel (INTC) ahead of its first-quarter results, cutting sales and earnings per share estimates by 6% and 38%, respectively. Arya kept his estimates on AMD (AMD) unchanged.
Earlier this month, AMD (AMD) renewed its GPU architecture pact with Samsung.