Lisa Su Keynote: Lisa Su speaks with Ryan Patel as part of the SXSW 2024 Conference & Festivals at the Austin Convention Center on March 11, 2024 in Austin, Texas. (Photo by Travis B. Paul/SXSW Conference & Festivals via Getty Images)
Travis B. Paul | Sxsw Conference & Festivals | Getty Images
Advanced Micro Devices Apple Inc. on Tuesday reported second-quarter earnings that beat Wall Street revenue expectations and showed continued growth in sales of the company's artificial intelligence chips.
AMD shares rose 8% in extended trading.
Here's how AMD performed compared to LSEG's consensus forecast for the quarter ended June 29:
Earnings per share: 69 cents adjusted vs. 68 cents Revenue: $5.83 billion vs. $5.72 billion expected
AMD said it expects sales of $6.7 billion in the current quarter, versus Wall Street's forecast of earnings of 93 cents a share on sales of $6.61 billion.
The chipmaker reported net income of $265 million, or 16 cents a share, compared with net income of $27 million, or 2 cents a share, in the year-ago period.
AMD shares are expected to fall about 6% in 2024, even though the company is the second-largest vendor of data center GPUs after NvidiaNvidia shares have more than doubled this year as AI GPUs become in demand for training and deploying advanced AI like ChatGPT and Nvidia has become the chip of choice.
Investors want to see AMD take market share from rival Nvidia with its MI300X AI chip and see significant growth in its data center AI business. Earlier this year, AMD said it expected $4 billion in AI chip sales this year, or about 15% of the company’s projected sales.
AMD CEO Lisa Su said on a call with analysts that the company saw “higher-than-expected” sales of AI chips, with revenue from the MI300 chip exceeding $1 billion during the quarter.
“As a result, we now expect data center GPU revenue to exceed $4.5 billion in 2024, up from the $4 billion we forecast in April,” Su said on a call with analysts.
AMD reported data center AI chip sales grew 115% year over year to $2.8 billion, driven by increased shipments of AI graphics processing units, AMD said. Analysts surveyed by Street Accounting had expected $2.75 billion in data center revenue.
AMD’s core business is making CPUs for laptops and servers. The company’s client PC sales were reported to have risen 49% year-over-year to $1.5 billion, versus expectations of $1.43 billion from Street Accounting. The growth suggests the PC market is recovering from a few years of post-pandemic slump.
AMD also makes chips for gaming consoles and GPUs for 3D graphics, which are reported under the company’s gaming segment. AMD reported gaming revenue of $648 million, down 59% year over year. Analysts were expecting sales of $676 million, according to Street Account.
The company's Embedded Products segment, which consists of products acquired through the 2022 acquisition of Xilinx for industrial customers, reported sales of $861 million, down 41% year over year and beating Wall Street expectations of $856 million.
