Big Tech Heats Up As AMD Binges $4.9 Billion On ZT Systems Acquisition (Watch Out, Nvidia)...

Well it’s Monday, and the market doesn't wait for literally no one. After a much needed weekend full of nothing but chaos, havoc, and absolute insanity - because, you know, I have kids - I woke up this morning with the news of AMD purchasing ZT systems flooded all over the financial media.

(Source: Reuters) 

So with that said, AMD is apparently living it’s dream of playing real life monopoly as they are now acquiring the hyperscale GPU racked, ZT Systems less than two months after binging a cool $665 million on Silo AI (Europe's largest private AI lab). 

(Source: AMD) 

The reason? Nvidia. That’s it. In fact, I legit wouldn’t be surprised if AMD executives had a picture of Jensen Huang in their breakroom with darts impaled in it. That’s how deep this rivalry runs, and right now, AMD ain’t F’ing around. Because while it may seem like AMD is simply just collecting tech companies like Pokémon cards…

ZT Systems isn’t just another tech outfit that's filling space for AMD. No, they are an absolute “unit” when it comes to AI and data center infrastructure - Think, Derek Henry, but for nerds and AI. 

(Source: Facebook)

You see, with a pile of benjamins amounting to $4.9 billion on the table, AMD is leveraging ZT to take a bigger bite out of the $400 billion data center AI market (projected by 2027). Whereas, according to reports, this purchase will allow AMD to integrate ZT’s hyperscale GPU rack designs to enhance its AI infrastructure offerings, while pushing ahead with their Instinct AI Accelerators and their EPYC CPUs. 

(Source: Wall Street Journal) 

What’s also interesting about this acquisition is that AMD intends to orchestrate its own cash-back deal as they intend to sell off ZT’s manufacturing business once the filings are are finalized. Meaning, AMD is only interested in keeping the juicy bits of ZT’s design metrics, aka the elements that make ZT’s competitive edge attractive. 

(Source: Giphy) 

For this reason, investors are absolutely buzzing in the pre-market as shares of AMD have jumped over 3% on the day - adding to last week's AMD surge of +10.69% after Big Tech regained some of its footing from the encouraging Fed data (PPI and CPI). 

Now again, this comes almost immediately after AMD’s purchase of Silo AI, where AMD can now offer end-to-end solutions that integrate both hardware and software, making them a more attractive option for enterprise customers looking for comprehensive AI solutions. 

(Source: AMD) 

Meaning now, with assets of ZT’s design and data center expertise, Silo AI’s LLM solutions, combined with AMD’s core technology that has gotten them into the ring in the first place - they’re now packing a pretty powerful punch in the world of AI market share. 

(Source: Giphy) 

For instance, while AMD’s purchases are giving Wall Street something to talk about this Monday, let’s not forget how much of a hot streak the company is on so far. Over the last two earnings season’s, AMD has body slammed top and bottom line estimates - where during their report back on July 30th, they beat analyst estimates on EPS and revenue by +1.26% and +1.99%, respectively. 

(Source: Yahoo Finance) 

However, the real star of the show is AMD’s trailing 12 month financials. In short, not only did AMD’s revenue catapult by +8.88% year-over-year, but net income, diluted EPS, net profit margin and even operating income ALL exploded by… *wait for it*.... 881.48%, 700%, 808%, and 1,445%. 

Hell friggin yeah, amirite? I know I’ve said this before, but these financial boosts look like the screenshotted trades from that slimy trading “Furu” (slang for fake guru) that follows you all over the internet with ads. 

(Source: Quora) 

So with all of this in the picture, including the fact that 11 out of 17 of our Stock.News indicators are flashing “strong buy” for AMD, what’s the takeaway for investors this beautiful Monday?

Well simply put, the AI race is only gaining more and more momentum as the days pile up. If you thought it was overhyped two months ago, think again buddy, because with these two tech behemoths like Nvidia and AMD pitted up against one another, competition is only set to grow more fierce - leading to more innovation, cutting edge products, and a ton of investor optimism.

(Source: CoinGeek) 

So while you sip on your Monday morning coffee, anxiously awaiting the opening bell, don’t sleep on AMD. Sure, they come off as Nvidia's annoying step-brother, but apparently the company is stepping up, growing some hair on their chest, and gunning for Nvidia's top spot…

In fact, now that I think about it, is AMD short for “Aemond”? Because dayum, the similarities of these situations couldn’t be more alike. (For all my House of Dragons peeps, you know what I’m talking about). 

(Source: Giphy) 

In the end, with this stock popping in pre-market on top of this new ZT Systems purchase, keep an eye on AMD throughout the day, it could be a wild start to the week that’s for sure. In the meantime, stay safe and stay frosty, friends! Until next time… 

Stocks.News holds positions in Intel as mentioned in the article.