Wall Street Analyst is optimistic about AMD’s acquisition of Xilinx

Advanced Media Devices or only AMD is leading in the processor market and seems to be crushing the competition. Earlier, AMD announced its decision to acquire the chip manufacturing industry Xilinx, known for its FPGA chipsets. AMD’s processors are increasing in demand in the data center market and artificial intelligence. Its decision to adopt TSMC’s fab manufacturing process has made the company cross its biggest rival intel in stock value.

However, its deal with Xilinx was earlier criticized by many and was not beneficial for the company. However, after seeing the third-quarter earnings of AMD and the increase in its stock value, Wall Street analysts have stated that the company’s future is quite profitable if its deal with Xilinx moves forward.

According to reports, Xilinx’s acquisition will result in 5-10 cents in its annualized earnings post-close and 25-30c in synergies. AMD management has stated that the deal will allow the company to expand its presence in growing market sectors such as 5G and automotive.

The most significant update from AMD’s acquisition of Xilinx is Wall Street analysts’ change in tone. According to them, once the deal is green flagged, AMD will become the world’s third fourth-largest integrated circuit design firm. It will rank behind NVIDIA Corporation, Qualcomm, and Broadcom.

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With this deal, AMD would ultimately surpass MediaTek, a broad market share in the smartphone business. With Xilinx also being a user of TSMC’s process nodes, this deal could allow AMD to have higher bargaining chances from the Taiwanese semiconductor manufacturer. It will enable the company to bring down its products’ costs and increase its demand.

With the increasing demand for AMD’s chips in the data center and cloud computing market, Xilinx’s acquisition will only boost its presence in the growing networking market.


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