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Advanced Micro Devices reported higher-than-expected revenue and earnings for the first quarter ended March 31, with revenue growing 55% to $ 5.3 billion on a non-GAAP basis (excluding Xilinx results).
Non-GAAP net income for the quarter was $ 1.6 billion, or 1.13 cents per share, beating expectations of 91 cents per share on a non-GAAP basis. Shares of AMD rose 4.6% to $ 95.39 per share in after-hours trading.
The Santa Clara, California-based company continues to benefit from the highly competitive Zen and Zen2 architectures for its processors, which can generate 50% or better performance per hour cycle than the previous generation. This architecture has put AMD ahead of Intel for the first time in a decade, and has helped perennial numbers. 2 PC Chipmaker as a fast-growing contender against Intel.
Over the past few years, Intel has also stumbled upon both the chip design side and manufacturing, where it has lost its technological advantage over competitors such as TSMC, which makes both processor and graphics chips for AMD. As a result, AMD has been gaining historic market share for the past three years.
Interestingly, AMD is reaping these benefits amid an epidemic and a shortage of historic chips powered by supply whips from unprecedented demand for electronic goods.
Excluding Xilinx, AMD’s quarterly revenue was $ 5.3 billion, non-GAAP gross margin was 53% and non-GAAP operating margin was 30%. On a GAAP basis, revenue, including Xilinx, was 5.9 billion, an increase of 71%.
AMD CEO Lisa Sue said in a statement: “The first quarter marked a significant turning point in our journey of measuring and converting AMD as we delivered record revenue and discontinued our strategic acquisition of Xilinx.” “Each of our businesses has seen a significant double-digit increase year-over-year, leading to more than double the revenue of EPYC server processors in the third straight quarter. Demand for our lead products remains strong, with our year-round guidance reflecting high AMD organic growth and the growth of the Xilinx business. ”
Intel, meanwhile, is doubling its production investments as a way to stay competitive and take advantage of the chip boom and supply shortages.
Q1 2022 Results
As noted, non-GAAP revenue was $ 5.3 billion, an increase of 55% year-over-year and 10% year-over-quarter. It was driven by more revenue in the computer and graphics as well as enterprise, embedded and semi-custom segments.
Analysts had expected AMD to report earnings of 91 cents per share on first-quarter revenue of $ 5.52 billion.
For the current second quarter, analysts expect AMD to post earnings of 99 cents on revenue of $ 6.38 billion.
Net revenue excluding GAAP was $ 1.6 billion compared to $ 642 million a year ago and $ 1.1 billion in the previous quarter.
Quarterly financial segment summary
The computing and graphics segment’s revenue was 2.8 billion, up 33% from a year earlier and 8% from the previous quarter. The increase was driven by Raizen and Radion chip sales. The quarter-over-quarter increase was driven by Ryzen processor sales. The average sales price of a client processor was increasing every year, like the sales of a graphics processing unit (GPU) chip.
The enterprise, embedded and semi-custom segment had revenue of 2.5 billion, up 88% from a year earlier and 13% from the previous quarter.
For Outlook, AMD expects Q2 2022 revenue to reach $ 6.5 billion, plus or minus $ 200 million, up 69% from a year earlier and 10% higher than in the previous quarter.
For the full year, AMD’s estimated revenue will be $ 26.3 billion, a 60% increase over a year earlier and a gross margin of 54%.
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