Saturday, August 13

AMD shares surge 10% after earnings, revenue and outlook outperform Street Views


Shares of Advanced Micro Devices Inc. soared in the extended session on Tuesday after the chipmaker’s quarterly and full-year results and outlook beat Wall Street estimates and the company posted a record profit margin of fifty%.

amd amd,
+2.21%
the shares soared 10% after hours, after a 2.2% gain in the regular session to close at $116.78.

AMD reported fourth-quarter net income of $974 million, or 80 cents per share, compared to $1.78 billion, or $1.45 per share, in the same period a year earlier. After adjusting for stock-based compensation and other factors, the Santa Clara, California-based company reported earnings of 92 cents per share, compared with 52 cents per share in the same period a year earlier.

Revenue increased to $4.83 billion from $3.24 billion in the prior year quarter. Analysts surveyed by FactSet had forecast adjusted earnings of 70 cents a share on revenue of $4.52 billion, after AMD projected between $4.4 billion and $4.6 billion.

“Each of our businesses performed extremely well, with data center revenue doubling year-over-year driven by the growing adoption of AMD EPYC processors among enterprise and cloud customers,” said AMD CEO. AMD, Lisa Su, in a statement. “We look forward to another year of significant growth in 2022 as we grow our current portfolio and launch our next generation of PC, gaming and data center products.”

Gross margins hit 50% in the fourth quarter, up from 45% in the prior year quarter and 48% in the third quarter. The 50% margin milestone is significant for AMD, as Intel Corp. INTC, its biggest rival,
+0.27%
it has been dealing with shrinking margins, which executives said would remain “comfortably above 50%,” or in the 52-53% range for the year.

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Sales of enterprise, embedded and semi-custom chips – the unit that includes data center and game console revenue – rose to $2.24 billion, compared with $1.28 billion a year ago. Analysts had forecast $2.1 billion.

In AMD’s computing and graphics segment, the company reported second-quarter sales of $2.58 billion, up from $1.96 billion a year ago, compared to analyst expectations of $2.42. billion.

AMD said it expects first-quarter revenue between $4.9 billion and $5.1 billion, while analysts had forecast $4.35 billion.

For 2022, AMD forecast gross margins of 51% for the year and said it expects revenue of about $21.5 billion, a 31% gain from 2021’s $16.43 billion. Analysts had forecast $16.13 billion for 2021. and $19.29 billion by 2022.

Last quarter, AMD raised its full-year sales guidance, as it has in all quarterly earnings reports so far this year, for about 65% year-over-year growth.

AMD recently received conditional regulatory approval from Chinese regulators for its $35 billion deal to acquire Xilinx Inc. XLNX,
+2.46%.
AMD revealed late last year that it expected the deal to close this quarter.

At the close of regular trading, AMD shares remained firmly in bear market territory, down 29% from their closing high of $161.91 set on Nov. 29, but have still gained 32% over the last 12 months. months. By comparison, the PHLX Semiconductor Index SOX,
+0.79%
is up 16% during that time, the S&P 500 SPX Index,
+0.69%
has gained 20%, and the tech-heavy Nasdaq Composite COMP
+0.75%
has gained 6.5%.


www.marketwatch.com

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