AMD valuation is frothy; market pays premium for CPU/AI accelerator position vs commodity perception.

And so as more supply comes online, if we start to see average selling prices go down, I think there will be an an increase of how much HBM that AMD and Nvidia actually purchase.

Jose why why why doesn't that fear happen to Nvidia? Why is it only happening to Mike or Dell? like why or AMD why is it only in Micron that's getting that fear

I if memory pricing goes down that would be I I would I would expect super micro Nvidia AMD to go up because now their bill of materials has incre decreased dramatically I I think so.

So I think the overall amount of net income that Micron is going to produce is so much higher than what people are currently anticipating. It's why UBS is saying they're going to buy back like 40% of their shares over the next, you know, two years.

>> Well, let me ask you a question before Tanner goes. Is this going to feed something in Tanner's mind? AMD is right behind Micron with market cap. And AMD does basically no free cash flow and EPS compared to Micron.

I mean at 35 3815 in Q1. If that is just flatline for the year, it's 15260 for EPS. At a 10 multiple, that's 1526. I mean, you look at AMD's numbers in Micron, they shouldn't trade anywhere near each other.

>> Jose, why should AMD be a trillion over? >> I mean, I do think AMD is trading a little bit at a frothy valuation. Um, but I would say on a typical semiconductor argument is in the CPU space, there's only barely been a few players, right?

I mean, and AI accelerators and the AI system in theory, right? In theory, if someone goes out there and massproduces memory, um AMD would just go to somebody else, right? That's and I that's not what's happening right now where it's here in the constraint.

But I think it's just that the market is still stuck in that old way is that you're just a memory player, right? That's all you are. Even though with HBM it kind of has completely changed that around.

I think the market still goes with that and would give a better valuation on somebody who is I would say not consider a commodity as it kind of in the past if that was an argument.

No matter how bullish I am in AMD no matter how um might be bullish on a company like Broadcom Nvidia is just the goat there.

So yeah you have some competitors to Nvidia with like Broadcom and AMD but like at its core if Jose's right about the innovation and Jose's right about supply coming online like Nvidia's margin shouldn't be affected by that if anything it should go up because they might have to spend less on those input costs.