IBM’s Divestiture and AMD’s Rumored Acquisition Focus on Data Centers, Cloud, and Profitability @themotleyfool #stocks $IBM $AMD $INTC $NVDA $XLNX

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After more than a decade of massive growth in cloud spending, it’s clear that data centers have become a modern computing unit staple, powering all sorts of basic services and future tech developments. With public and private cloud spending expected to grow on average by double-digit percentages every year in the decade ahead — in which time it could become a $1 trillion-a-year industry — businesses are scrambling to capitalize on the opportunity.
To that end, International Business Machines (NYSE:IBM) recently announced a divestiture to help it focus on this key market, and reports indicate Advanced Micro Devices (NASDAQ:AMD) is close to announcing a deal to acquire fellow chip designer Xilinx (NASDAQ:XLNX). Both moves will help the companies focus on data centers and cloud computing, and will also greatly improve profitability. 

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A leaner, meaner legacy tech giant
IBM completed its acquisition of cloud-based application development and management outfit Red Hat in 2019. The takeover was billed as transformational for IBM as it signaled its shift to emphasizing data center and cloud computing over its legacy hardware lineup. While Red Hat most certainly updated IBM’s cloud capabilities, it thus far hasn’t had the same desired effect …

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