New Products Will Accelerate AMD’s Footprint In Embedded Applications – Forbes

Earlier this week, AMD announced its second generation Embedded R-series Accelerated Processing Unit and Central Processing Unit family for embedded applications. Code-named “Bald Eagle”, the new solutions are based on AMD’s x86 Steamroller architecture and targeted at gaming machines, medical imaging, digital signage, industrial control and automation (IC&A), communications and networking infrastructure. It is the first embedded processor to incorporate the Heterogeneous System Architecture.

In an effort to reduce its dependence on the declining traditional PC market, AMD has increased its focus on new growth markets. As part of its restructuring efforts, the company intends to derive 50% of its revenue from high growth business, including embedded solutions, semi-custom, ultra-low power client, professional graphics and dense server, by the end of 2015.

We estimate embedded processors to contribute around 10% to AMD’s valuation and forecast revenue from this division to cross $750 million over our review period. AMD is the first company to offer its customers both ARM and x86 architecture based solutions for low-power and high-performance embedded compute designs. We expect new product launches this year to accelerate AMD’s growth in the embedded market.

Our price estimate of $3.79 for AMD is at a slight discount to the current market price.

See our complete analysis for AMD

How Big Is The Embedded Processors Market?

The embedded processors segment is a fast growing market with the embedded x86 market slated to reach $7 billion by 2016. As per a recent VDC Research report, the market for traditional and intelligent embedded CPU systems will grow 36% in the next few years, from 330 million units in 2013 to over 450 million units by 2016. The x86 and ARM architecture together are estimated to account for 82% of the total addressable market.

AMD’s Embedded Processor Market Line-up

AMD launched the industry’s first discrete graphics card based on Graphics Core Next architecture, AMD Embedded Radeon E8860 GPU, in February this year. The GPU is specifically designed to advance the visual growth and parallel processing capabilities of embedded applications, and offers double the performance in the same power envelope as its predecessor.

Below are some other products that the company intends to launch later this year -

1. Hierofalcon CPU SoC Family: It is AMDs first ARM-based platform which targets growth in embedded data center applications, communications infrastructure and industrial solutions. The ARM processors are expected to start shipping by the second half of 2014.

2. Step Eagle APU SoC: This further extends the performance and low-power range of AMDs current Embedded G-Series APU SoC platform. Boasting of enhanced features and better performance-per-watt, these processors are designed for low-power embedded applications.

With the addition of the above products, AMD will have a broader range of embedded processors for different segments in its portfolio, offering a number of price, performance and power options to meet the needs of embedded designers. The company intends to take on the different segments in the embedded market by offering its customers a range of solutions to chose from ? from low-power to high-performance - with a broad ecosystem of software and hardware partners supporting multiple operating systems, including Windows and Linux.

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