Advanced Micro Devices (AMD) ripped to a five-month high on news it may be getting into esports.
Alphabet (GOOGL) announced it will use the actively traded company’s chips in its new Stadia cloud-based video-game service. That could make AMD a key player in a fast-growing pastime already drawing millions of daily views.
Stadia looks to “cut the cord” for gamers by eliminating the need for consoles like Microsoft’s (MSFT) Xbox. Instead, titles will be available on demand via any device. It’s perhaps the biggest example yet of IT’s migration to cloud computing.
Players will also be able to share their games instantly on YouTube (also part of GOOGL). The next big question is how quickly Stadia can ramp its inventory of titles.
The esports industry had its first pure-play initial public offering (IPO) in late February, Super League Gaming (SLGG). Researcher Newzoo estimates revenue for the space will rise 27 percent to $1.1 billion this year and reach $1.8 billion by 2022. Its audience is estimated at over 450 million viewers.
AMD’s contract with GOOGL was another big win for AMD CEO Lisa Su, who successfully made the company into a cloud-computing powerhouse by promoting Epyc chips.
Despite remaining below 2018’s high of $34.14, it’s still the S&P 500’s best performer in the last year.