![]() Therefore, whether these stocks are now bargains or not is largely dependent on the all-important data center market. While there isn't a sign of that now, that would affect these companies' current pillars of strength. However, if there is a broader economic slowdown, Chan's fear is that data center customers could also begin to pull back at some point. These figures for the data center segment were the strongest for all of these companies last quarter. Last quarter, Nvidia saw its data center segment rise a whopping 83%, with AMD's embedded, enterprise, and semi-custom segment, which includes its EPYC data center chips, up 88%. Even Chan, in his note, pointed out the continued strength in the data center, as the cloud transition and artificial-intelligence (AI) applications continue to grow. ![]() Yet while fears about consumer electronics sales have been affecting each of these stocks, these names are also exposed to the data center sector, which has been very strong and remains so. The same fears are likely plaguing Nvidia and AMD today both of those companies are exposed to PCs and gaming, two discretionary sectors that could see a decline this year amid a consumer spending slowdown. ![]() The same thesis led analysts at Piper Sandler ( PIPR -3.44%) to downgrade Micron to sell last week. As the pandemic-era boom in personal computing devices comes to an end with the economy reopening, consumers are now spending on experiences - not to mention high food and gas prices biting into household budgets. He says his recent channel checks revealed persistently weak demand for memory chips for smartphones and PCs.
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