AMD earnings report Q2 2024

Superior Micro Gadgets reported second-quarter earnings on Tuesday that beat Wall Road expectations for income and confirmed continued development in gross sales of the corporate’s AI chips.

AMD shares rose 8% in prolonged buying and selling.

Here is how AMD did versus LSEG consensus expectations for the quarter ended June 29:

• Earnings per share: 69 cents adjusted vs. 68 cents anticipated
• Income: $5.84 billion vs. $5.72 billion anticipated

AMD stated it expects about $6.7 billion in gross sales within the present quarter, versus Wall Road expectations of 93 cents in earnings per share on $6.61 billion of gross sales.

The chipmaker reported internet earnings of $265 million, or 16 cents per share, versus internet earnings of $27 million, or 2 cents per share, within the year-ago interval.

AMD shares are down about 6% 12 months up to now, regardless that the corporate is the second largest vendor of information middle graphics processing models (GPUs) after Nvidia. Nvidia’s inventory has greater than doubled this 12 months as AI GPUs are required for coaching and deploying superior AI like ChatGPT and Nvidia has develop into the chip of alternative.

Traders need to see AMD take market share away from its longtime rival Nvidia with its MI300X AI chip and sign development in its information middle AI enterprise. Earlier this 12 months, AMD stated it anticipated $4 billion in synthetic intelligence chips gross sales this 12 months, or about 15% of the corporate’s anticipated gross sales.

AMD CEO Lisa Su stated on a name with analysts that the corporate noticed “larger than anticipated” gross sales of its AI chips, and that income from its MI300 chips exceeded $1 billion throughout the quarter.

“In consequence, we now count on information middle GPU income to exceed $4.5 billion in 2024, up from the $4 billion we guided in April,” Su stated in a name with analysts.

AMD AI chip gross sales are reported within the firm’s Knowledge Middle section, which soared 115% 12 months over 12 months to $2.8 billion, pushed by a rise in AI GPU shipments, AMD stated. Analysts polled by StreetAccount have been anticipating $2.75 billion in Knowledge Middle income.

AMD’s core enterprise is making central processors (CPUs) for laptops and servers. Gross sales for PCs are reported within the firm’s Shopper section, which rose 49% from the year-earlier interval to $1.5 billion, versus expectations of $1.43 billion from StreetAccount. That development means that the PC market is recovering from a number of years of post-pandemic stoop.

AMD additionally makes chips for gaming consoles and GPUs for 3D graphics. It reported $648 million income within the gaming class, down 59% 12 months over 12 months. Analysts have been anticipating $676 million in gross sales, per StreetAccount.

The corporate’s embedded section, which is made up of merchandise acquired via the Xilinx acquisition in 2022 for industrial clients, reported $861 million in gross sales, dropping 41% 12 months over 12 months; the section beat Wall Road expectations of $856 million.