AMD (NASDAQ:AMD) has announced new x86 G-Series system-on-chip (SoC) and central processing unit (CPU) solutions for embedded applications, including early adoption by HP for thin client deployment in healthcare, finance, education and retail, as well as Advantech for industrial applications in rugged environments. The new products expand upon the high-performance and low-power capabilities of AMD’s existing Embedded G-Series platform. AMD claims that its embedded G-series SoC family is one of the most widely adopted platforms in the history of AMD Embedded Solutions, and the new solutions bring better capabilities, experiences and ecosystem support.
In an effort to reduce its dependence on the declining traditional PC market, AMD has increased its focus on new growth markets. As part of its restructuring efforts, the company intends to derive 50% of its revenue from high growth businesses, including embedded solutions, semi-custom, ultra-low power client, professional graphics and dense server, by the end of 2015.
We estimate embedded processors to contribute around 10% to AMD’s valuation and forecast revenue from this division to cross $750 million over our review period. AMD is the first company to offer its customers both ARM and x86 architecture based solutions for low-power and high-performance embedded compute designs. There is a growing need for more advanced embedded solutions in healthcare, finance, education and retail services. We expect new product launches this year to accelerate AMD’s growth in the embedded market.
Our price estimate of $3.79 for AMD is almost in line with the current market price.
AMD has a broad range of embedded processors for different segments in its portfolio, offering a number of price, performance and power options to meet the needs of embedded designers. The company intends to take on the different segments in the embedded market by offering its customers a range of solutions to chose from – from low-power to high-performance - with a broad ecosystem of software and hardware partners supporting multiple operating systems, including Windows and Linux. The introduction of the new products further expands AMD’s embedded product portfolio.
- Embedded G-Series SoC Solutions: Code-named “Steppe Eagle,” the new embedded G-series SoC solutions offer 53% higher overall performance compared to previous G-Series SoC solutions. The new processors offer enhanced security features, ultra low power consumption and advanced graphics performance for rugged applications such as ATMs, kiosks, automation, medical equipment and gaming machines.
- Embedded G-Series CPU Solutions: Code-named “Crowned Eagle,” the new G-series CPU solutions come with a 64 bit processor (based on dual- or quad-core x86 CPU architecture), and are best suited for networking and communications infrastructure applications. Cost and energy efficiency are important parameters, as data centers continue to scale up to meet the rising demand brought by the cloud and the increasing proliferation of devices. The new solutions claim to offer 34% more CPU-centric performance-per-dollar than competing Intel solutions.
How Big Is The Embedded Processors Market ?
The embedded processors segment is a fast growing market with the embedded x86 market slated to reach $7 billion by 2016. As per the VDC Research report, the market for traditional and intelligent embedded CPU systems will grow 36% in the next few years, from 330 million units in 2013 to over 450 million units by 2016. The x86 and ARM architecture together are estimated to account for 82% of the total addressable market.
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