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AMD Debuts Radeon RX 6700 XT Graphics Card: Major Takeaways

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Advanced Micro Devices (AMD - Free Report) recently launched its AMD Radeon RX 6700 XT graphics card to augment PC video gaming experiences. The company added that the card was primarily aimed at enhancing “1440p gaming performance at maximum settings”.

Per AMD’s estimates, the latest Radeon graphics card could deliver two times improved performance for chosen gaming titles as against existing installed base of older generation graphics cards. For some selected esports gaming titles, the latest Radeon GPU can offer 165 frames per second (FPS).

AMD stated that the latest Radeon graphics card is expected to be available from Mar 18, 2021 at the company’s website along with AMD’s board partners (PowerColor, ASUS, Gigabyte, MSI, SAPPHIRE and XFX) as well as at retailers and online retailers. The chip is priced at $479.

 

AMD further announced that it is teaming up with the Mercedes-AMG Petronas Esports Team. Mercedes is leveraging AMD Ryzen 5000 Series Desktop Processors, as well as AMD’s Radeon RX 6000 Series graphics cards along with AMD Radeon software technologies to augment esports gaming rigs as well as deliver low-latency gameplay and improved driving experiences to unlock driver potential.

Robust features to drive adoption

AMD Radeon RX 6700 XT graphics chip is based on the company’s RDNA 2 gaming architecture and is powered by 7 nanometer (nm) process technology. The chip also features DirectX Raytracing (DXR) capabilities.

Radeon RX 6700 XT graphics card also boasts 40 compute units and 12GB of GDDR6 (Graphics Double Data Rate type 6) memory that enhances experiences for AAA titles for video gamers. The graphics card also is integrated with AMD FidelityFX, which is an open-source toolkit for boosting visual effects for game developers.

The latest Radeon graphics card also has 96 MB of AMD Infinity Cache as well as Memory Interface of 192-bit. It has speeds of 13.21 teraflops (TFLOPs) and 26.43 TFLOPs for peak single and half precision compute performances, respectively and render output units (ROPs) of 64.

Radeon RX 6700 XT graphics card features AMD Smart Access Memory which facilitates improved communication between Radeon GPU and Ryzen processors.

These robust features are expected to drive adoption of AMD’s new Radeon processors and in turn, will boost the company’s top line in the upcoming days and instill investors’ optimism in the company’s stock. Notably, shares of AMD have returned 68% in past year compared with the industry’s rise of 76.3%.

AMD Rides on the Gaming Wave

Due to the ongoing pandemic and ensuing shelter in place guidelines, there has been a massive spurt in video gaming activity including cloud gaming, globally. This is driving demand for gaming notebooks and desktops.

Increasing adoption of innovative technologies like Artificial Intelligence (AI), and augmented and virtual reality (“AR/VR”) technologies for video gaming are also driving GPU demand.

Per Verified Market Research, the worldwide GPU market is anticipated to reach $185.31 billion by 2027 at a CAGR of 32.82% from 2021 to 2027.

We believe that the launch of the new graphics card will help AMD capture a larger market share further amid growth in uptake of gaming PCs.

Nevertheless, increasing expenses on product development amid intense competition from the likes of NVIDIA (NVDA - Free Report) are persistent overhangs.

Zacks Rank & Stock to Consider

At present, AMD carries a Zacks Rank #3 (Hold).

Some better-ranked stocks in the broader technology sector are Shopify (SHOP - Free Report) and Skyworks (SWKS - Free Report) . Both the stocks sport a Zacks Rank #1 (Strong Buy).

You can see the complete list of today’s Zacks #1 Rank stocks here.

The long-term earnings growth rate for Shopify, and Skyworks is currently pegged at 32.5%, and 19%, respectively.

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