[Manuel Calavera]

AMD is making a huge effort to grow its business in China while avoiding regulatory issues in both China and the U.S.

Advanced Micro Devices (AMD) is not leaving any stone unturned in order to show strong performance in China. One of its partners, Hygon, has recently launched “Dhyana” CPUs which are almost identical to AMD’s Epyc range. This would be a further source of worry for Intel (INTC). Through majority ownership in joint ventures, AMD can ensure that its IP is safe while also reaping the benefit of higher sales. Last year, AMD’s revenue from China rose by 58% and it now accounts for over 30% of the total revenue base.

AMD is also launching semi-custom chips for gaming PC and console segment in China. This should allow AMD to deliver high revenue growth rates on the back of its business in China. There is a tail-risk due to further regulatory issues on both Chinese and the U.S. side. However, taking a long-term view, we can see that AMD is building a strong foothold in the Chinese market which can give huge benefits in the next few years.