Lisa Su on the Keynote: Lisa Su in conversation with Ryan Patel through the SXSW 2024 Conference and Festivals, held on the Austin Convention Center on March 11, 2024 in Austin, Texas. (Photo by Travis P. Ball/SXSW Conference & Festivals via Getty Images)
Travis P. Ball | Sxsw Conference & Festivals | Getty Images
modern micro devices reported Second quarter results on Tuesday that beat Wall Street revenue expectations and showed continued growth in sales of the corporate’s AI chips.
AMD shares rose 8% in prolonged trading.
Here’s how AMD performed in comparison with LSEG consensus forecasts for the quarter ended June 29:
- Earnings per share: 69 cents adjusted in comparison with 68 cents expected
- revenue: $5.84 billion versus expected $5.72 billion
AMD expects sales of around $6.7 billion in the present quarter. Wall Street had expected earnings per share of 93 cents on sales of $6.61 billion.
The chipmaker reported net income of $265 million, or 16 cents per share, compared with net income of $27 million, or 2 cents per share, a yr earlier. Previous yr period.
AMD shares have fallen about 6% for the reason that starting of the yr, despite the fact that the corporate is the second-largest provider of graphics processing units (GPUs) for data centers after NVIDIA. Nvidia’s stock price has greater than doubled this yr as AI GPUs are required to coach and deploy advanced AI like ChatGPT, making Nvidia the chip of selection.
Investors want AMD to make use of its MI300X AI chip to take market share from longtime rival Nvidia and signal growth in its data center AI business. Earlier this yr, AMD said it expected $4 billion in sales from artificial intelligence chips this yr, about 15% of the corporate’s expected revenue.
AMD CEO Lisa Su said on a conference call with analysts that the corporate had “higher than expected” sales of its AI chips and that sales of its MI300 chips exceeded $1 billion within the quarter.
“As a result, we now expect GPU revenue in data centers to exceed $4.5 billion in 2024, above the $4 billion we forecast in April,” Su said in a conference call with analysts.
AMD AI chip revenue shall be reported in the corporate’s data center segment, which rose 115% yr over yr to $2.8 billion, driven by a rise in AI GPU shipments, AMD said. Analysts surveyed by StreetAccount expected revenue of $2.75 billion in the info center segment.
AMD’s core business is making central processing units (CPUs) for laptops and servers. PC revenue is reported in the corporate’s client segment and rose 49% year-over-year to $1.5 billion, while StreetAccount had expected $1.43 billion. This growth suggests that the PC market is recovering from a multi-year post-pandemic slump.
AMD also makes chips for gaming consoles and GPUs for 3D graphics. The company reported revenue of $648 million within the gaming category, down 59% yr over yr. Analysts had expected revenue of $676 million, in accordance with StreetAccount.
The company’s embedded segment, which consists of products acquired through the 2022 acquisition of Xilinx for industrial customers, reported revenue of $861 million, down 41% yr over yr; the segment beat Wall Street expectations of $856 million.
