Is AMD a Serious Threat to Intel and Qualcomm?

AMD has lagged Intel in terms of raw CPU performance in recent years. Can its Beema and Mullins processors turn things around?

Mar 27, 2014 at 1:00PM

Intel (NASDAQ:INTC) and Qualcomm (NASDAQ:QCOM) have been fiercely competing in the mobile segment in recent years. The growing number of competitive downmarket processors and slowing growth rate of tablet shipments, however, has limited their growth.

In 2014, there is reason to believe that the upcoming offerings from Advanced Micro Devices (NASDAQ:AMD) will further intensify competition and make it even harder for Intel and Qualcomm to grow.

Performance gains
Intel's current-generation 22nm Bay Trail system-on-chip range was unveiled in September last year. In terms of raw processing power, Intel chips outperformed Qualcomm's latest offerings and were at par with AMD's 28nm Kabini processors. This was a big achievement for AMD, as it was able to match Intel's performance using a relatively older fabrication process. 

At this year's Consumer Electronics Show, AMD teased us with its upcoming Beema and Mullins processor lineup targeted at mobile devices like ultra-thin laptops, tablets and 2-in-1s. Although the chips still use a 28nm process, architectural improvements boost its performance significantly. Compared to Kabini processors, the iGPU and CPU performance of AMD's new processors have improved substantially -- up 20% and 35%, respectively. 

Speaking about the performance gains, the general manager of AMD noted:

What you will see is that on graphics performance, it is substantially better. We're talking about 250% better than the comparable Bay Trail products. What is different is on the compute performance, where we had traditionally been not as strong, we see significant performance improvements.



These claims are corroborated by actual benchmarks. As illustrated in the table above, AMD's Beema and Mullins processors clearly outperform Intel's Bay Trail. What's interesting is that AMD's performance gains follow a relatively older 28nm process, as opposed to Intel's latest 22nm.

Pricing threat
In the overall mobile processor industry, Qualcomm leads the pack with a gigantic 64% market share. Intel comes in third, with an 8% market share. 

But low-end offerings from MediaTek and Allwinner have been fiercely competing with Intel and Qualcomm in the downmarket industry. In fact, Allwinner recently became the second largest downmarket processor manufacturer, while MediaTek retains its top spot. Qualcomm and Intel are currently placed at third and sixth in that industry, respectively. 

Heading into 2014, IDC estimates that sales of sub-$150 tablets will surge by 36% this year and further strengthen the foothold of these low-end processor manufacturers. In this case, AMD has a tremendous growth opportunity. 

Historically speaking, AMD has priced its products competitively. If the company offers Beema and Mullins processors at aggressive price points, downmarket tablet manufacturers might feel compelled to use AMD processors. This will open up a whole new growth avenue for Advanced Micro Devices.

Words of caution
While AMD presents an optimistic outlook, there are a few factors that can limit its growth:

  • We have seen that AMD's Mullins and Beema processors outperform Intel's Bay Trail. But for its rapid adoption, AMD will have to price its offerings competitively.
  • AMD will also have to move its product rapidly, as Intel's Cherry Trail is slated for release in the second half of 2014. The latter will reportedly use 14nm process nodes. 
  • Investors should also note that AMD hasn't yet announced whether its low-power APUs will support Android, which commands a 78.1% global market share. In case AMD doesn't add support for Android, its growth will be fairly limited; Intel's Bay Trail and Qualcomm's Snapdragon support Android. 

Investors should keep a close eye on key metrics -- like Beema and Mullins release dates, their pricing patterns, supported platforms, and technological improvements in Intel's Cherry Trail processors -- and expose their portfolio accordingly.

Are you ready for this $14.4 trillion revolution?
Let's face it, every investor wants to get in on revolutionary ideas before they hit it big. Like buying PC-maker Dell in the late 1980s, before the consumer computing boom. Or purchasing stock in e-commerce pioneer in the late 1990s, when it was nothing more than an upstart online bookstore. The problem is, most investors don't understand the key to investing in hyper-growth markets. The real trick is to find a small-cap "pure-play" and then watch as it grows in EXPLOSIVE lockstep with its industry. Our expert team of equity analysts has identified one stock that's poised to produce rocket-ship returns with the next $14.4 TRILLION industry. Click here to get the full story in this eye-opening report.

Piyush Arora has no position in any stocks mentioned. The Motley Fool recommends Intel. The Motley Fool owns shares of Intel and Qualcomm. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

1 Key Step to Get Rich

Our mission at The Motley Fool is to help the world invest better. Whether that’s helping people overcome their fear of stocks all the way to offering clear and successful guidance on complicated-sounding options trades, we can help.

Feb 1, 2016 at 4:54PM

To be perfectly clear, this is not a get-rich action that my Foolish colleagues and I came up with. But we wouldn't argue with the approach.

A 2015 Business Insider article titled, "11 websites to bookmark if you want to get rich" rated The Motley Fool as the #1 place online to get smarter about investing.

"The Motley Fool aims to build a strong investment community, which it does by providing a variety of resources: the website, books, a newspaper column, a radio [show], and [newsletters]," wrote (the clearly insightful and talented) money reporter Kathleen Elkins. "This site has something for every type of investor, from basic lessons for beginners to investing commentary on mutual funds, stock sectors, and value for the more advanced."

Our mission at The Motley Fool is to help the world invest better, so it's nice to receive that kind of recognition. It lets us know we're doing our job.

Whether that's helping the entirely uninitiated overcome their fear of stocks all the way to offering clear and successful guidance on complicated-sounding options trades, we want to provide our readers with a boost to the next step on their journey to financial independence.

Articles and beyond

As Business Insider wrote, there are a number of resources available from the Fool for investors of all levels and styles.

In addition to the dozens of free articles we publish every day on our website, I want to highlight two must-see spots in your tour of

For the beginning investor

Investing can seem like a Big Deal to those who have yet to buy their first stock. Many investment professionals try to infuse the conversation with jargon in order to deter individual investors from tackling it on their own (and to justify their often sky-high fees).

But the individual investor can beat the market. The real secret to investing is that it doesn't take tons of money, endless hours, or super-secret formulas that only experts possess.

That's why we created a best-selling guide that walks investors-to-be through everything they need to know to get started. And because we're so dedicated to our mission, we've made that available for free.

If you're just starting out (or want to help out someone who is), go to, drop in your email address, and you'll be able to instantly access the quick-read guide ... for free.

For the listener

Whether it's on the stationary exercise bike or during my daily commute, I spend a lot of time going nowhere. But I've found a way to make that time benefit me.

The Motley Fool offers five podcasts that I refer to as "binge-worthy financial information."

Motley Fool Money features a team of our analysts discussing the week's top business and investing stories, interviews, and an inside look at the stocks on our radar. It's also featured on several dozen radio stations across the country.

The hosts of Motley Fool Answers challenge the conventional wisdom on life's biggest financial issues to reveal what you really need to know to make smart money moves.

David Gardner, co-founder of The Motley Fool, is among the most respected and trusted sources on investing. And he's the host of Rule Breaker Investing, in which he shares his insights into today's most innovative and disruptive companies ... and how to profit from them.

Market Foolery is our daily look at stocks in the news, as well as the top business and investing stories.

And Industry Focus offers a deeper dive into a specific industry and the stories making headlines. Healthcare, technology, energy, consumer goods, and other industries take turns in the spotlight.

They're all informative, entertaining, and eminently listenable ... and I don't say that simply because the hosts all sit within a Nerf-gun shot of my desk. Rule Breaker Investing and Answers contain timeless advice, so you might want to go back to the beginning with those. The other three take their cues from the market, so you'll want to listen to the most recent first. All are available at

But wait, there's more

The book and the podcasts – both free ... both awesome – also come with an ongoing benefit. If you download the book, or if you enter your email address in the magical box at the podcasts page, you'll get ongoing market coverage sent straight to your inbox.

Investor Insights is valuable and enjoyable coverage of everything from macroeconomic events to investing strategies to our analyst's travels around the world to find the next big thing. Also free.

Get the book. Listen to a podcast. Sign up for Investor Insights. I'm not saying that any of those things will make you rich ... but Business Insider seems to think so.

Compare Brokers