AMD Reaches $1 Trillion Market Cap but Remains Distant No. 2 to Nvidia
Advanced Micro Devices (AMD) has become the latest addition to the $1 trillion club, joining Nvidia and other semiconductor stocks in this exclusive group. This milestone comes after AMD's market cap reached $1 trillion during midday trading on September 23.
The company's journey to this point is a remarkable one, having started with a valuation of just $2 billion in 2014 under the leadership of CEO Lisa Su. Since then, AMD has executed several rebuilds, including the introduction of Ryzen in PCs and Epyc in servers, as well as the acquisition of Xilinx and Pensando.
Despite its growth, AMD remains a distant No. 2 in the artificial intelligence (AI) accelerator market, with Nvidia holding a significant lead. While AMD has landed several high-profile deals with AI hyperscalers such as OpenAI, Meta Platforms, Anthropic, Oracle, and Microsoft, these partnerships are not yet contributing enough to close the gap with Nvidia.
Nvidia's dominance in the GPU realm is further reinforced by its ownership of the default software stack (CUDA) and networking fabric, thanks to strategic partnerships. AMD trades at a trailing price-to-earnings (P/E) ratio of around 158, while Nvidia trades closer to 28 times trailing earnings.