The semiconductor industry has enjoyed terrific growth over the past couple of years, thanks to the booming demand for chips from multiple areas such as data centers, personal computers (PCs), smartphones, factories, and vehicles, among others.

The semiconductor industry generated $582 billion in revenue last year, according to IDC. The industry's revenue is expected to increase 13.7% in 2022 as well to $661 billion. However, Wall Street is having concerns about the strength of the semiconductor industry following terrible reports from the likes of Nvidia and Micron Technology.

However, Advanced Micro Devices (AMD 3.70%) is one semiconductor stock that could continue to thrive even if there is a downturn in the broader market. Let's see why that may be the case.

AMD is growing at a solid pace despite headwinds

When AMD released its second-quarter results on Aug. 2, it surprised Wall Street by delivering 70% year-over-year revenue growth to $6.6 billion despite the huge slowdown in sales of PCs. The chipmaker's impressive growth was aided by the data center business, but it is worth noting that it also witnessed robust growth in sales of chips used in PCs.

AMD's revenue from the client segment, which includes sales of processors used in desktops, notebooks, and workstations, increased 25% year over year to $2.2 billion last quarter. This is impressive considering that global PC shipments fell 15.3% in Q2. AMD's market share gains in both desktop and notebook processors played a key role in driving the client segment's growth.

According to Mercury Research, AMD exited Q2 with a 20.6% share of the desktop processor market, an increase of 3.5 percentage points over the prior year. Its share of the notebook processor market stood at 24.8% last quarter, an impressive jump of 4.8 percentage points over the year-ago period. So, AMD's technology lead over rival Intel (INTC 2.13%) helped it mitigate the softness in the PC market and increase the sales volumes of processors last quarter.

What's more, the average selling price (ASP) of AMD's client processors increased year over year, boosting the company's operating margin by one percentage point to 32%. The good part is that AMD expects its client processor business to keep improving despite the PC slowdown. That's because AMD's Ryzen processors are expected to power close to 300 notebook models this year.

Additionally, AMD will release its next-generation Ryzen processors based on the 5-nanometer manufacturing process in the current quarter. These new processors should help AMD take more share away from Intel as the latter's competing Raptor Lake processors, which are expected to hit the market in the fourth quarter, will be manufactured using a 10nm process.

The smaller die size of AMD's upcoming processors means that its chips could pack in more computing power while being more power-efficient at the same time. AMD's current lineup of Ryzen processors is made on a 7nm process, indicating that the company is set to widen the gap over Intel, and that could translate into stronger sales in the client business.

The data center business is taking off big time

AMD's data center revenue shot up 83% year over year in Q2 to $1.5 billion. The chipmaker witnessed record sales of its EPYC server processors last quarter, thanks to terrific demand from cloud and enterprise customers.

Mercury Research estimates that AMD controlled 13.9% of the server processor market in the second quarter, an increase of 4.4 percentage points over the prior year. AMD is set to push the envelope further in the server business with the launch of its next-generation Genoa processors later in 2022. Based on a 5nm process, these processors could steamroll Intel, as leaked benchmarks indicate.

So, AMD looks all set to corner a bigger share of the server processor market, and that could supercharge the company's growth as it sees a $42 billion revenue opportunity in this segment in the long run. Throw in other growth drivers such as console gaming, and it is easy to see why AMD could keep defying any potential weakness in the semiconductor market.

In all, AMD's market share gains and its secular growth opportunities indicate that it is a top semiconductor stock to buy right now, especially considering that it is trading at 22 times forward earnings as compared to a five-year average forward earnings multiple of 42.