AMD produced a stellar first quarter earnings report, beating estimates across the board. A strong data-center chip market and improved margins meant that adjusted earnings came in at $1.13, versus 47¢ a year ago and the 92¢ estimate.
The company also completed the acquisition of the data-center powerhouse Xilinx in the quarter, which allowed revenue to hit $5.9 billion, the highest quarterly figure in the company’s history. Analysts were expecting revenue to come in at $5.3 billion.
AMD is the second-largest computer processor manufacturer behind Intel, and Intel’s report last week was relatively shaky. Despite the weak personal computing market, where there are early indications of a glut in chips, AMD’s cutting-edge product suite and diversification have allowed it to outperform Intel recently.
Sales from the company’s computing and graphics segment ended the quarter at $2.8 billion, up 33% year over year. The faster growing data-center segment reported a $2.5 billion quarter against expectations of $2.35 billion.
The company posted an adjusted gross margin of 53% versus an estimate of 51.8%. AMD outsources the bulk of its manufacturing to Taiwan Semiconductors, which means that margins are thinner compared to Intel.
Furthermore, competition in the graphic chip segment will heat up going forward as Nvidia continues to lead that market and new entrant Intel has promised strong benchmark performance.
The chipmaker did offer strong guidance for the upcoming quarter and fiscal year. It expects annual revenue of $26.3 billion for 2022, up 60% year over year, versus expectations of $24.1 billion. It raised its gross margin outlook to 54% while analysts were calling for 52.2%. AMD shares were up over 4%, last trading at $95 in the after-market.
Featured CoursesRecent news
GE Aerospace Stock Rises as AI Cuts Hypersonic Engine Design Time
GE Aerospace is showing investors what artificial intelligence looks like when applied to one of the world’s most technically demanding industries. Shares rose 1.58% Tuesday as the company revealed that researchers at its Niskayuna, New York, facility used an in-house generative AI tool to produce a preliminary hypersonic ramjet engine design, compressing a process that […]
Nvidia Shares Slip 1.1%: Why a 3-Day Losing Streak Could Be Good News
Nvidia is heading into its most anticipated earnings report of the year on the back foot, and that may be exactly what the stock needs. Shares fell 1.1% in premarket trading Tuesday, extending a three-day pullback from last Thursday’s closing high of $235.74. For investors watching closely, a lower entry point ahead of Wednesday’s results […]
Alphabet and Blackstone Shares Rise on $5B AI Cloud Joint Venture
Google and Blackstone are joining forces to build a new AI cloud company, and investors in both firms are taking notice. Alphabet shares rose 0.5% and Blackstone gained approximately 1% in premarket trading after the companies announced plans to create a U.S.-based joint venture offering data center capacity and Google’s proprietary Tensor Processing Unit chips […]
Trade with fewer limits
Day trade with fewer limits at fast speed. Buy stocks and ETFs at low fees.