Street Calls of the Week
NEW YORK/AUSTIN - IBM (NYSE:IBM) and AMD (NASDAQ:AMD), the $265 billion semiconductor powerhouse with a strong GOOD financial health rating according to InvestingPro, announced plans on Tuesday to jointly develop next-generation computing architectures that combine quantum computers with high-performance computing systems.
The collaboration aims to integrate AMD’s CPUs, GPUs, and FPGAs with IBM’s quantum computers to accelerate a new class of algorithms that neither quantum nor classical computing could efficiently handle independently. AMD brings substantial momentum to this partnership, with impressive 27% year-over-year revenue growth and strong liquidity demonstrated by a healthy 2.49 current ratio. Get deeper insights into AMD’s financial metrics and 16 additional key investment tips with InvestingPro.
According to a press release, the companies plan an initial demonstration later this year showing how IBM quantum computers can work alongside AMD technologies to deploy hybrid quantum-classical workflows.
"Quantum computing will simulate the natural world and represent information in an entirely new way," said Arvind Krishna, Chairman and CEO of IBM.
AMD Chair and CEO Dr. Lisa Su stated, "As we partner with IBM to explore the convergence of high-performance computing and quantum technologies, we see tremendous opportunities to accelerate discovery and innovation."
The proposed quantum-centric supercomputing architecture would assign different components of complex problems to the computing paradigm best suited to solve them. For instance, quantum computers might simulate molecular behavior while classical supercomputers handle data analysis.
The companies will also explore how open-source ecosystems like Qiskit could support the development of algorithms leveraging this hybrid approach.
IBM has already taken steps toward integrating quantum and classical computing through partnerships with organizations including RIKEN, Cleveland Clinic, and Lockheed Martin.
AMD currently powers the world’s two fastest supercomputers according to the TOP500 list: Frontier at Oak Ridge National Laboratory and El Capitan at Lawrence Livermore National Laboratory. As a prominent player in the Semiconductors & Semiconductor Equipment industry, AMD’s market leadership is backed by robust fundamentals and comprehensive analysis available in the InvestingPro Research Report, part of the exclusive coverage of 1,400+ top US stocks.
In other recent news, Advanced Micro Devices Inc. (AMD) announced the resignation of Philip Carter, their Corporate Vice President and Chief Accounting Officer, effective September 5. Carter’s departure is not due to any disagreements with AMD’s accounting or financial reporting practices. Meanwhile, Mizuho has raised AMD’s stock price target from $183 to $205, maintaining an Outperform rating. The investment firm adjusted its revenue and earnings per share estimates for AMD’s September quarter to $8.80 billion and $1.15, respectively, slightly above consensus estimates.
Additionally, AMD and ARM-based processors have continued to gain CPU market share against Intel, according to a Bank of America review. In the PC market, AMD’s shipments rose 1% quarter-over-quarter following a weak first quarter. Furthermore, U.S. Treasury Secretary Scott Bessent mentioned a potential expansion of a revenue-sharing agreement with China, which currently gives the U.S. government 15% of revenue from sales of certain advanced semiconductor chips. This agreement may be extended to other sectors in the future.
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