With the PC market withering and the mobile market exploding, the two big PC CPU makers should be having some trouble posting profit growth. But over the past 12 months, shares of Advanced Micro Devices Inc. (NYSE: AMD) is up nearly 6.5% while shares of Intel Corp. (NASDAQ: INTC) are down about 5.2%. Of course Intel’s market cap of $114 billion compared with AMD’s $2.2 billion doesn’t leave much doubt about which company has been the most successful over the long haul, but AMD has been picking up steam while Intel is struggling.

AMD’s design wins in all three of the major game controllers gets some of the credit for the rise in the company’s stock. Microsoft Corp. (NASDAQ: MSFT) has joined Sony Corp. (NYSE: SNE) and Nintendo which had already said they would include an AMD chip in their new game controllers.

Hewlett-Packard Co. (NYSE: HPQ), Dell Inc. (NASDAQ: DELL), and other server manufacturers have opened up a new server type, the microserver, a device that can use lower-priced CPUs than traditional servers, and AMD plays in this space with its SeaMicro line. Some analysts predict that these low-cost, low-power devices will take up to 20% of the server market by 2016.

And as for mobile devices, where Qualcomm Corp. (NASDAQ: QCOM) dominates, AMD — and Intel — continue trying to break in and have enjoyed only modest success so far. The company’s microserver play looks like a better bet, but AMD has to do something in mobile.

The company posted a loss of $74 million in the second quarter after a profit of $37 million in the first quarter. AMD’s CEO promised a profitable third quarter, likely on projected sales for the Nintendo Wii U, Sony PlayStation 4, and Xbox One. The fourth quarter should also be profitable because game controllers do well during the holiday gift-giving season. What AMD does next could tell the tale.

Shares are up more than 3% shortly after noon on Monday at $3.68 in a 52-week range of $1.81 to $4.65. The consensus price target is around $4.25, so a little caution is advised.

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