Advanced Micro Devices (AMD) on Tuesday, October 29, released information about its earnings for the quarter ended September 28, 2024.
The mentioned company’s net revenue for the third quarter of the current year was fixed at $6.81 billion. For the same period in 2023, the corresponding figure was $5.83 billion. The preliminary LSEG forecast provided that the company’s revenue for the third quarter of 2024 will be fixed at $6.71 billion.
AMD also reported adjusted earnings per share of 92 cents. The preliminary forecast of LSEG provided that the corresponding indicator would be fixed at the same level.
Besides, the company reported that sales of its data centers business doubled last quarter. It is worth noting separately that the corresponding upward dynamic has been observed for the second quarter in a row.
AMD expects its revenue for the current quarter to be fixed at around $7.5 billion. According to media reports, these expectations correspond to the consensus estimates of analysts. At the same time, in this case, the indicator is projected to fall by 22% year-on-year. Against the background of corresponding expectations, the value of the company’s shares decreased by 7% in extended trading.
AMD’s net income for the third quarter of 2024 was fixed at $771 million. For the same period last year, the corresponding figure amounted to $299 million.
Since the beginning of 2024, AMD securities have risen in price by about 20%. At the same time, the company’s competitors in the area of chip development and production, such as Nvidia and Broadcom, demonstrated much more intensive growth over the same period in terms of the upward dynamic of the mentioned indicator. It is also worth noting that there is currently a rise in consumer demand for artificial intelligence chips. With a high degree of probability, the corresponding tendency will increase, as the machine intelligence industry is on a trajectory of active development and scaling.
AMD is currently the second-largest vendor of graphics processing units for data centers. The corresponding products are used for the training and deployment of large models of generative artificial intelligence.
In the current month, AMD announced a new AI chip called the MI235X. The company predicts that by 2028, the financial volume of the artificial intelligence graphics processing units market will reach $500 billion. On Tuesday, AMD stated that it expects sales of machine intelligence chips in the current year to amount to $5 billion in monetary terms. It is worth noting that the previous version of this forecast provided that the mentioned figure would be fixed at $ 4.5 billion.
AMD chief executive officer Lisa Su on a call with analysts stated that customer and partner interest in the new MI325X chip is high. She also said that production shipments of this microcircuit will be launched in the current quarter.
AMD’s artificial intelligence chips are reported in its data center segment. Total sales of this business to the company for the third quarter of 2024 were recorded at $3.5 billion. The firm stated that the corresponding result was largely driven by the sale of AI graphics processing units under the Instinct brand. Overall data center revenue for the third quarter of 2024 increased by 122% year-on-year.
Lisa Su also stated that AMD continues to see a high level of demand from cloud providers and other companies to build out artificial intelligence infrastructure.
The company’s gross margin increased to 54% in the third quarter of 2024. The firm stated that the dynamic of the corresponding indicator is associated with a growth in data center revenue.
AMD also carries out activities for the production of central processing chips for laptops and servers. Personal computer sales are reported in the company’s client segment. In this case, revenue for the third quarter of 2024 increased by 23% year-on-year, reaching $1.9 billion.
AMD also manufactures chips for gaming consoles and PCs. The revenue of this company’s business fell by 69% year-on-year last quarter. In monetary terms, the corresponding figure was $462 million.
The company’s embedded business, which includes less-expensive chips for industry and other applications, generated revenue of $927 million in the third quarter of 2024. This indicator showed a decrease of 25% year-on-year.
