AMD is popping after releasing its newest low-power chip (AMD)

AMD headquarters

AMD released a new embedded graphics processing unit on Tuesday, and the stock is trading 4.80% higher at $13.32 after the news.

The company announced on Tuesday that its newest chip based on the Polaris architecture will be launched later this month. The chip, the Embedded Radeon E9170 Series GPU, is designed for smaller, dedicated systems that need an added graphics kick.

Example uses for the new chipset include casino games, medical displays and retail signage, according to the company. The chip has the ability to drive five simultaneous 4k displays with relatively low power consumption, which could be helpful for applications like big retail displays.

The chip differs from the company's line of desktop graphics cards, as it is built to be embedded in specially designed systems rather than used for general purpose graphics computing.

Nvidia recently pushed its embedded series of chips at a conference held by the company. The company partnered with JD.com to work on delivery drones for rural areas of China. SunTrust said that Nvidia's move into the embedded market was a good move, and could "deliver significant revenue quickly." Nvidia promoted the AI capabilities of its embedded chip while AMD is focusing on the purpose-built systems its chip could be used for.

AMD is up 17.42% this year.