AMD Earnings – beats on sales and profit but warns of a 10% revenue decline in Q1

https://www.cnbc.com/2023/01/31/amd-earnings-q4-2022.html

Here’s how the company did versus Refinitiv consensus estimates for the quarter ending in December:

EPS: $0.69, adjusted, versus $0.67 per share expected

Revenue: $5.6 billion, versus $5.5 billion expected

AMD said it expected $5.3 billion in sales in the current quarter, slightly lower than a Refinitiv estimate of $5.47 billion. AMD’s estimate suggests a 10% decline in sales in the current quarter. It also said it expected its adjusted gross margin to be about 50%, a key metric for chipmakers like AMD.

AMD reported earnings as many of its rival chipmakers have stumbled in recent weeks, citing lower consumer demand for finished electronics and gluts of parts needed to make PCs and servers. Intel, AMD’s primary competitor, reported a disastrous quarter last week that included a weak 2023 outlook.

While AMD said it saw slow sales for its PC chips and graphics processors, it said its data center segment rose 42% year-over-year, suggesting it took market share from Intel.

AMD attributed its beat to strong growth in its embedded and data center businesses, and said that its client revenue, or chips for PCs and laptops, and its gaming segment were down.

AMD’s data center segment rose 42% year-over-year to $1.7 billion. Its embedded segment grew 1,868%, AMD said, because of sales from its purchase of Xilinx.

AMD’s gaming business, which is comprised of graphics cards and chips for gaming consoles, was down 7% year-over-year. The decrease came from graphics cards and was offset by “semi-custom” revenue, which is what the company calls its chips for systems like the PlayStation 5.