Advice Micro Devices Inc., shorter AMD, is a global semiconductor company that makes computer chips....
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Advice Micro Devices Inc., shorter AMD, is a global semiconductor company that makes computer chips. The company has four segments: Data Center, Client, Gaming, and Embedded segments. ADM submitted a glum sales outlook in the year 2022 for the third quarter on sales earnings. Lisa Su, AMD's Chief Executive, stated that the global economic weakness had impacted a substantial segment of the company due to corporate buyers' servers being more cautious about building their computing infrastructure. The company posted a net income of $66 million, down 93% compared to the previous year's third quarter. Multiple tech companies were also stung by slowing consumer spending, rising interest rates, and soaring inflation. For example, Intel, AMD's first competitor, reported a 20% drop in revenue for the same quarter (Fitch, 2022).
As an investor, before investing in a particular company, I will evaluate its financial health by analyzing its balance sheet, income statement, and cash flow. Then, we can calculate the current ratio from the balance sheet, which measures the company's working capital. Next, from the income statement, we can check the growth of earnings and the growth of net income. Finally, from the statement of cash flow, we can examine whether the company generating real cash money or losing it. These steps are part of the first step of predictive analysis, gathering historical data.
Finally, using predictive analysis classification to figure out the investment risk assessment. For example, the predicted classes may be low risk or high risk, where an individual calculation is classified in either group. Lastly, we can use predictive analysis to analyze further market trends, buying habits, and customers' personal details to identify buying patterns and perform customer segmentation.
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