AMD Stock Rises As Chipmaker Completes Xilinx Acquisition

Advanced Micro Devices (AMD) on Monday completed the largest acquisition in semiconductor industry history with its $49 billion purchase of Xilinx. AMD stock rose on the news.

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In a news release, AMD said the transaction creates a leader in high-performance and adaptive computing. It also expands AMD’s total addressable market to about $135 billion from $80 billion.

AMD announced the all-stock deal in October 2020. At the time, the transaction was worth $35 billion, but its value climbed with AMD stock.

AMD makes central processing units and graphics processors while Xilinx makes specialty chips known as field-programmable gate arrays, or FPGAs, and adaptive system-on-a-chip devices, or SoCs. The acquisition will allow AMD to capture more of the data center market.

AMD Boasts Strongest Portfolio In Industry

“The acquisition of Xilinx brings together a highly complementary set of products, customers and markets combined with differentiated IP (intellectual property) and world-class talent,” AMD Chief Executive Lisa Su said in a written statement.

She added, “Xilinx offers industry-leading FPGAs, adaptive SoCs, AI (artificial intelligence) engines and software expertise that enable AMD to offer the strongest portfolio of high-performance and adaptive computing solutions in the industry.”

AMD’s acquisition of Xilinx comes a week after Nvidia (NVDA) abandoned its planned purchase of Arm Holdings. That deal faced significant antitrust concerns in the U.S., Europe and China.

AMD Stock Finds Support At Key Level

In morning trading on the stock market today, AMD stock climbed 3%, near 116.60.

AMD stock hit an all-time high of 164.46 on Nov. 30, but tumbled during the recent stock market correction. During Friday’s sell-off, it found support at its 200-day moving average line, according to IBD MarketSmith charts.

On Feb. 1, the Santa Clara, Calif.-based company delivered a beat-and-raise fourth-quarter report.

AMD stock ranks eighth out of 31 stocks in IBD’s fabless semiconductor industry group, according to IBD Stock Checkup. It has an IBD Composite Rating of 94 out of 99. IBD’s Composite Rating is a blend of key fundamental and technical metrics to help investors gauge a stock’s strengths. The best growth stocks have a Composite Rating of 90 or better.

Follow Patrick Seitz on Twitter at @IBD_PSeitz for more stories on consumer technology, software and semiconductor stocks.

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