[ad_1]
Lisa Su, President and CEO of Advanced Micro Devices (AMD), holds a 3rd generation Ryzen desktop processor while speaking during a keynote session at the 2019 Consumer Electronics Show (CES) in Las Vegas, on the 9th January 2019.
David Paul Morris | Bloomberg | Getty Images
AMD stock was held steady in extended trading after the company reported revenue and profits that exceeded Wall Street’s already high expectations for the chipmaker.
Here’s how AMD did against Wall Street’s expectations:
- EPS: $ 0.52, adjusted, versus $ 0.47 based on Refinitiv consensus estimates
- Returned: $ 3.24 billion, compared to $ 3.03 billion according to Refinitiv consensus estimates
AMD also provided a strong forecast for the current quarter, ranging between $ 3.1 billion and $ 3.3 billion, and said it forecast 2021 revenue growth of 37%. AMD’s revenue in 2020 grew 45% year-over-year.
The biggest highlight for AMD this quarter was its business segment, which grew 176% year-over-year and 13% from last quarter to $ 1.28 billion. This division sells server chips as well as processors and graphics processors for game consoles like the Sony PS5 and Microsoft Xbox One.
AMD attributed this growth to its semi-custom sales, what it calls its console chip business, and said there is strong demand for the current generation of Sony and Microsoft consoles. He also said that his server revenues have increased on a sequential basis.
AMD’s business selling PC processors and graphics chips, which it calls Computing & Graphics, grew 18% year-on-year to $ 1.96 billion. This is due to increased sales of processors, AMD said.
AMD launched new processors and graphics chips last fall that have been constantly sold out. It said its desktop processor revenues are increasing on an annual basis, which suggests that its Ryzen processors are in fierce competition with Intel for market share.
At the start of trading on Tuesday, shares of AMD were up 85% in the past year. This is partly because of investor enthusiasm for semiconductors, but also because, last year, AMD gained a technological advantage over its main competitor, Intel. Intel was stable in the extended trade.
AMD outsources its manufacturing to partners, including Taiwan’s TSMC, while Intel is still committed to making its best chips. This allowed AMD to access more advanced chip manufacturing on a so-called 5 nanometer process, which makes the chips denser and more efficient.
In October, AMD announced plans to buy Xilinix in a $ 35 billion deal that is expected to close by the end of this year. Xilinix focuses on specialized chips that can efficiently handle tasks such as compressing videos, compared to general-purpose processors from AMD. This acquisition should give AMD more firepower to compete with Intel in the data center chip market.
[ad_2]
Source link