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AMD Stock: Why The Google Deal May Be The First Of Many For Advanced Micro Devices, Inc.

  • AMD recently struck a deal with Google to put its GPUs in the latter's cloud platform.
  • Google's competitors like Amazon's AWS and Microsoft's Azure, use Nvidia chips, but older ones.
  • The Google deal is a big win for AMD, and many more deals could potentially follow.

Sunnyvale, California based AMD (NSDQ:AMD) recently clinched a deal to put its GPUs in Google's cloud platforms. Coming after AMD's Alibaba (NYSE:BABA) deal last month, this deal is a much bigger win, and could open the doors to many more deals in the cloud services space, which have eluded AMD so far. By virtue of its early lead, this space has been dominated by arch rival Nvidia. Both, Amazon's AWS and Microsoft's Azure reportedly use only Nvidia GPUs at the moment. However, that could potentially change following this deal, owing to a combination of factors. Here's why this deal could potentially be followed by a slew of other deals over the coming months.

AMD Will Benefit From The Cloud Battle

The battle is heating up in the cloud services space, and whichever way that goes, AMD may emerge as one of the beneficiaries. On November 15th, Alphabet Inc's (NSDQ:GOOGL) Google announced that starting from early 2017, it would offer GPUs made by AMD and NVIDIA (NSDQ:NVDA) to Google Compute Engine and Google Cloud Machine Learning users. The announcement is a big win for AMD for multiple reasons.

For starters, the data center space has been dominated by AMD's arch-rival Nvidia for a long time now. By virtue of its early lead...