Advanced Micro Devices Inc. (NASDAQ: AMD) reported its second quarter financial results and surpassed estimates in revenue and earnings. The chipmaker reported its strongest earnings in seven years, sending shares 7.1% higher during Thursday’s pre-market hours.
For the second quarter, AMD reported revenue of USD 1.76 Billion, increasing 53% year over year and topping FactSet’s estimates of USD 1.72 Billion. The Company reported an EPS of USD 14 cents, while analysts had polled for an EPS of 12 cents.
“We had an outstanding second quarter with strong revenue growth, margin expansion and our highest quarterly net income in seven years,” said Dr. Lisa Su, AMD President and Chief Executive Officer. “Most importantly, we believe our long-term technology bets position us very well for the future. We are confident that with the continued execution of our product roadmaps, we are on an excellent trajectory to drive market share gains and profitable growth.”
The Computing and Graphics segment reported revenue of USD 1.09 Billion, growing 64% year over year, but falling 3% quarter over quarter. The segment was significantly driven by the strong sales of the Company’s Radeon products and continued growth of its Ryzen products. AMD said the quarterly decline was due to lower revenue from GPU products in the blockchain market.
Enterprise, Embedded and Semi-Custom segment reported revenue of USD 670 Million, up 37% year over year due to higher semi-custom and server revenue.
AMD showcased within the quarters it 12 nanometer Zen+ processor, which is expected to propel sales within the third quarter. The Company also showcased its 7 nanometer Radeon “Vega” graphics processor, which is expected to launch later this year.
"As expected, AMD had another solid growth quarter with 2nd gen Ryzen, Ryzen mobile, and Epyc all ramping strong, leading to an overall 54% revenue gain," said Moor Insights analyst Patrick Moorhead. “It also appears AMD is starting to get some traction in the commercial workstation market, a very large market profit pool."
For the third quarter, AMD forecasts revenue to be approximately USD 1.7 Billion, plus or minus USD 50 Million. The Company projects non-GAAP gross margin to increase by approximately 38%, driven by the sales growth of Ryzen and EPYC products.