Advanced Micro Devices reported revenue and earnings for the first quarter ended March 31 beat expectations, with revenue increasing 55% to $5.3 billion on a non-GAAP basis (excluding Xilinx results).
On a non-GAAP basis, AMDs stocks are up 4.6 percent to $95.39 per share.
The Santa Clara, California,-based company continues to benefit from its highly competitive Zen and Zen 2 processor designs, which can achieve 50% or greater performance per clock cycle than Intel''s previous generation. This architecture has put AMD ahead of Intel in performance for the first time in a decade, and it has helped the perennial No. 2 PC chipmaker into a fast-growing contender.
Intel has also stumbled on both the chip design side as well as in manufacturing, claiming that it has lost its technological advantage to rivals such as TSMC, which also makes both processors and graphics chips for AMD. As a result, AMD has been making significant market share gains for the past three years.
What''s interesting about AMD''s advancements in the wake of a historically chip shortage that was fueled by the supply spike as a result of the epidemic and unprecedented demand for electronic goods.
Excluding Xilinx, AMD had a record quarterly income of $5.3 billion, a non-GAAP gross margin of 53%, and a non-GAAP operating margin of 30%. On a GAAP basis, including Xilinx, revenue sat $5.9 billion, up 71%.
As we delivered record revenue and ended our strategic acquisition of Xilinx, the first quarter marked a key inefficiencies in our endeavor to scale and transform AMD, according to Lisa Su. Each of our employees was driven by a double-digit percentage year over year, which means demand for our leadership products was higher. As a result of our increased full-year guidance, AMD''s growth and the addition of the growing Xilinx business, each of our competitors has continued.
Intel is doubling down on its manufacturing investments as a way to stay competitive and to profit from the chip boom and supply shortage.
During the quarter, AMD acquired Pensando for $1.9 billion.
In an analyst call, Pensando will add a high-tech company that has already developed an industry-leading DPU and software stack with key customers, including IBM, HPE, Microsoft, Oracle, and Goldman Sachs.
Q1 2022 results
As reported, non-GAAP revenue increased by 55% year over year and 10% quarter-over-quarter. This was driven by improved revenues in computer and graphics, as well as enterprise, embedded, and semi-custom sectors. Su said AMD was confident it boosted client processor market share for the eighth quarter.
Although the PC market is experiencing some fallout following multiple quarters of near-record unit deliveries, we remain focused on the premium, gaming, and commercial sectors of the market, where we see significant growth opportunities and anticipate to continue increasing global client revenue share.
AMD''s earnings per share are expected to be reported for the first quarter, which is $5.52 billion.
AMD to produce 99 cents per share for the second quarter, based on $6.38 billion of revenue.
Net income from Non-GAAP was $1.6 billion, compared to $642 million in a year ago, and $1.1 billion in the previous quarter.
Quarterly financial segment summary
Revenue for the computing and graphics segment was $2.8 billion, up 33% from the previous quarter, but 8% increased from Ryzen and Radeon chip sales. The quarter-over-quarter increase was fueled by Ryzen processor sales. Graphic processing units (GPU) chip sales.
Revenue from the companies, embedded, and semi-custom sectors increased by 88 percent from a year ago, compared to the previous quarter.
Su claims that semi-custom sales increased by a significant double-digit percentage year over year due to strong demand for Sony and Microsoft consoles as well as Valves'' new Steam Deck.
AMD forecasts that Q2 2022 revenue would reach $6.5 billion, plus or minus $200 million, up 69 percent from the previous quarter.
AMD expects revenue to be $26.3 billion for the entire year, up 60% from the same year before, and gross margins of 54%. In the second quarter, AMD will have fresh segments that include Xilinx and gaming segments.
AMD has announced the introduction of a new Dragon Range processor for gaming platforms in 2023, based on the Zen 4 architecture. It will be aimed at the extreme gaming laptop market.