Chris Lau, Kapitall: AMD has just released a new line of graphics cards, but will investors be swayed? Advanced Micro Devices (AMD) just released graphics cards that would refresh its lineup of highly profitable products for the PC market. These cards support games at ultra-high definition resolutions, and for many reasons should be welcome news for shareholders if consumers catch on. [Read more on Tech from Kapitall: MadCatz and NVIDIA Join Google and Amazon in the Big Market of Microconsoles] AMD dropped overall; from around $4 to $3.34 after reporting weak sales in the PC market. But after the product release, shares rebounded in recent sessions. The R9 290X graphics processor costs $549, and should be considered fairly priced for game enthusiasts when compared to initial prices of other high-end chips that have come out in previous years. This is a significant release for AMD, because it is the fastest video card AMD ever produced that is single-GPU. However, it won’t be long until rival NVIDIA (NVDA) reveals its response to AMD with the GTX 780 Ti. Early reports suggest that this NVIDIA card will be faster, but will not be competitively priced compared to AMD’s card. With these new products coming to the market, investors will want to know if AMD is still an appealing investment among chip suppliers. Click on the interactive chart to see data over time. Price war for graphics cards To keep prices competitive with AMD products, NVIDIA reduced the price of its GTX 660 and GTX 650 Ti to $179 and $129, respectively. The GTX 700-series are still $249 and above. By comparison, AMD’s R7 250 start at around $100, while the new R9 280X is $300.
AMD has an edgeThe AMD 290X card has an edge over NVIDIA’s Titan. In crossfire bridge mode (when multiple GPUs are used concurrently), a 290X is only slightly behind the performance of NVIDIA’s 780 Titan. AMD developed a solution whose die is 3/5 the size of NVIDIA’s titan, yet still provides solid performance on 4K resolution. Below: R9 290X comparable to GTX Titan and GTX 780. Source: [H]ardOCP …but trails NVDIA in this way The newly released graphics card has high power usage and heat generation compared to NVIDIA’s product. Consumers might set aside these drawbacks, because they are getting a less expensive card instead. AMD looks attractive AMD’s new R9 290X matches NVIDIA’s high-end Titan card on a performance comparison. At 4K resolution, AMD’s product performs even faster. On HardOCP, a site for PC game enthusiasts, the card was described as providing performance that was 10-23% faster than NVIDIA’s Titan. By selling its premium card at a competitive price level, investors could expect that AMD boosts its market share in the PC market. This will be good news for shareholders who are waiting for AMD stock to rebound. That is, unless NVIDIA steps it up.
(Written by Chris Lau, a Kapitall Contributor. All data sourced from Zacks Investment Research.)