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AMD Expands Its Gaming Portfolio With Its Entry In The SSD Market

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Microprocessor and graphic processors manufacturer AMD has marked its entry in the storage space with by launching its own line of Radeon R7 Series Solid State Drives (SSDs) targeted specifically at the gaming enthusiast market. AMD has entered into a new technology partnership with Toshiba owned OCZ Storage Solutions. The latter will manufacture the SSDs, which will be available in 120GB, 240GB, and 480GB capacities at a cost of $99.99, $163.99, and $298.99, respectively. AMD’s Radeon R7 series will be the first high performance SSDs to utilize the Toshiba Group’s latest A19 MLC NAND flash process and the proven Barefoot 3 M00 controller.

With its entry in the SSD market, AMD aims to gain a reputation of a “one-stop shop” for enthusiast gamers. Its portfolio of high-performance solutions now includes Radeon graphics cards, FX processors, Accelerated Processing Units, AMD Radeon memory, processor chipsets, and more. The company claims that its Radeon brand is synonymous with performance and quality amongst PC gamers, and it intends to carry that reputation into the SSD market with a series of drives that offer an ideal combination of performance, reliability and affordability.

AMD claims that it has no plans to target the higher end of the SSD market yet. The entire hardware line targets the large percentage of enthusiast gamers that build their own high performance PC and notebook systems for gaming.

Our price estimate of $4.17 for AMD is almost in line with the current market price.

See our complete analysis for AMD

AMD Aims To Derive 50% Of Its Revenue From High Growth Markets By 2015

AMD announced a three-part restructuring plan in Q3 2012 in an effort to strengthen its competitiveness in the market and better manage its expenses and cash. Deriving an increasing proportion of revenue from new-growth markets was a key part of the company’s restructuring strategy. Having incurred losses for several quarters, AMD returned to profitability and positive cash flow in Q3 2013. Renewed demand in its traditional PC segment and growth opportunities in new markets have helped AMD improve its financial and operational performance in the last few quarters.

AMD claims to be on track with its goal of deriving 50% of its revenue from high growth markets, including semi-custom and ultra-low power processors, professional graphics processors as well as processors for dense server and embedded solutions, by the end of 2015.

Expanding Footprint In The Game Console Market To Spur AMD’s Semi-Custom Business

AMD devised a unified gaming strategy in March 2013 that addresses its plan to drive the gaming market across consoles, cloud platforms, tablets and PCs. It believes that it is effectively positioned to drive the next revolution in gaming, and now powers all major next generation consoles including Sony's PlayStation 4, Nintendo's Wii U and Microsoft's Xbox One. These systems typically have proprietary interfaces and are not intended to work with these new products.

Strong demand for game consoles was a key factor behind AMD's growth in the first half of 2014 as the company shipped millions of units to support the next-generation Sony and Microsoft game consoles. Sony and Microsoft together sold more than 7 million units so far, more than double the number of prior generation consoles sold in their first quarter of introduction. AMD expects its semi-custom business to continue growing strongly as game consoles ramp up throughout the year. It claims to be on track to win 1-2 new semi-custom designs this year.

By further expanding its product portfolio, AMD’s entry in the SSD segment leverages its unique capabilities in graphics and computing to target the full range of gaming.

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AMD’s ARM: A Smart Move?, The Motley Fool, July 29, 2014))

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