AMD surpasses its Q2 earnings by 70% with $6.55 billion in revenue

AMD surpasses its Q2 earnings by 70% with $6.55 billion in revenue ...

Advanced Micro Devices said revenues and earnings for the second quarter ended June 30 exceeded expectations, with revenue boosting by 70% to $6.55 billion on a GAAP basis.

AMDs' net income for the quarter was $1.707 billion, or $1.05 a share, compared to expectations of $1.05 a share on non-GAAP basis, with revenues of $6.5 billion. In after-hours trading, the company is down 3.7 percent to $95.55 a share.

For the first time in a decade, AMD has remained a reliable computer chipmaker thanks to its highly competitive Zen and Zen 2 processor architectures.

Intel's performance was significantly better than its competitors'. In the past couple of years, Intel has also stumbled on both the design side and in manufacturing, where it has lost its technological advantage to AMD's TSMC, which manufactures both processors and graphics chips.

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AMD has been making these advances in the midst of a historic chip shortage driven by the supply chain from the epidemic and unprecedented demand for electronic goods.

AMD reported a quarterly profit of $6.55 billion, with a non-GAAP gross margin of 54%, and a non-GAAP operating margin of 30%. Revenues on a GAAP basis were $6.55 billion, up 70%.

AMD CEO Lisa Su said the company's eighth consecutive quarter of record revenue was driven by our robust execution and expanded product portfolio. Each of our segments increased significantly year over year, led by increased sales of our data center and embedded products. We expect further growth in the second half of the year backed by our next generation 5nm product deliveries.

Intel, in turn, is downping its manufacturing investments in order to stay competitive and benefit from the chip boom and supply shortage.

AMD is expected to report earnings per share of $1.03 for the second quarter ended June 30, based on $6.53 billion in revenues. For the third quarter ending September 30, analysts expect AMD to report earnings per share of $1.09 for $6.82 billion in revenue.

AMD reported datacenter revenues of $1.5 billion, up 83 percent from a year earlier, due to robust sales of Epyc server processors. Operating income was $472 million, compared to $204 million a year ago, driven by increased revenue and partially increased operating expenses.

Su stated that Epyc processor demand was strong in the quarter, with growth across cloud and enterprise customers. In the cloud, more than 60 new instances powered by third-generation Epyc processors launched in the quarter from AWS, Baidu, Google, Microsoft Azure, and Oracle

Ryzen mobile processor sales boosted client processor revenue for the ninth quarter in a row, compared to $538 million a year ago.

AMD said it is on track to deliver its 5nm Ryzen 7000 desktop processors and AM5 later this year. It expects gaming graphics to be down in the third quarter, but it will continue to develop its high-end RDNA 3 GPUs later this year.

Su said AMD made significant improvements in its datacenter GPU footprint in the quarter, highlighted by the AMD-based Frontier supercomputer, which placed it at the number 1 spot on the list of the world's fastest supercomputers.

Because of the Xilinx acquisition, embedded segment revenue increased by 2,228% year on year. All other operating losses were $1.5 billion, compared to $92 million a year ago due to amortization of intangible assets related to the Xilinx acquisition.

AMD has announced that it is working on its Zen 4 and Zen 5 core (coming in 2024) architectures.

AMD expects revenue to exceed $200 million in Q3 2022, up 55% from the same month last year due to growing in the datacenter and embedded industries.

AMD projects revenue of $26.3 billion for the whole year, up 60% from the previous year, and gross margins of 54%, according to Su. The customer desire for the 5nm Genoa server CPU is tremendous.

AMD has been on a significant growth trajectory since Su's arrival in the United States. AMD has never been stronger, and the markets for our products have never been as vast or diverse.

Su said the company expects to see continued growth in the second half of the year, led by next-generation 5nm devices.

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