AMD Revenue Q3 2021
Lisa Su, President and Chief Executive Officer of Advanced Micro Devices Inc. (AMD), presents the AMD Ryzen 4000 Series chip during an AMD press event at CES 2020 in Las Vegas, Nevada, USA, on Monday, January 6th 2020.
Bridget Bennett | Bloomberg | Getty Images
AMD reported third quarter results on Tuesday after the bell, with earnings and revenue beating analysts’ expectations and a strong forecast for the fourth quarter.
The share gained up to 1% in extended trading.
Here’s how the chipmaker acted against Refinitiv’s consensus estimates for the quarter ended October 2:
- EPS: $ 0.73 adjusted versus expected $ 0.67, 16% more than last year.
- Revenue: $ 4.31 billion versus an expected $ 4.12 billion, 54% more than last year
AMD expected fourth quarter revenue of $ 4.5 billion, ahead of analysts’ expectations of about $ 4.25 billion for the quarter. AMD is forecasting 39% annual growth in the fourth quarter.
AMD is one of the companies that has benefited the most from the surge in electronics sales over the past 18 months as its central processors and graphics processors power personal computers, servers, and game consoles. These sales are recorded in AMD’s computers and graphics segment, which recorded sales of $ 2.4 billion, up 44% year over year.
The PC market has slowed from its rapid pace a year ago when people around the world still needed computers to work or study from home, but AMD said its chips are selling at higher average prices as customers move up opt for more powerful processors.
AMD reports sales of server chips and console chips in the embedded, enterprise and semi-custom segments. AMD reported $ 1.9 billion in sales in this important category, up 69% year over year, powered by Epyc server chips and higher “semi-custom” sales, which are the semiconductors it makes to game console manufacturers sold.
AMD is about to gain market share in the server market behind its Epyc processors as giants like Microsoft and Google buy its chips to run their cloud services. AMD CEO Lisa Su said in a statement that data center sales have doubled year over year and now represent “mid-20s” of total AMD sales.
Game consoles like Sony’s Playstation 5 and Microsoft’s new Xbox models are still in high demand and difficult to find as they sell out quickly. AMD’s graphics and central processors are also hard to find in stores in stores.
“Semi-custom sales have increased sequentially and year-on-year as demand for the latest Microsoft and Sony consoles remains very strong,” Su said on Tuesday when he called analysts. “We expect semi-custom sales to increase sequentially in the fourth quarter as we continue to add supply to meet continued demand for game consoles.”
AMD is a fabless chip company. It develops the technology in its semiconductors and outsources manufacturing to foundry partners such as TSMC and GlobalFoundries. In September, AMD boss Su said she expected the chip shortage to subside in 2022.
AMD continues to control costs and increase profitability. The gross margin was 48% versus 44% for the same period last year as customers buy more expensive processors. They forecast gross margins of 49.5% in the fourth quarter. AMD net income for the quarter was $ 893 million.
Last October, AMD announced plans to purchase $ 35 billion worth of Xilinix, which would give the company more clout to compete with Intel in the data center chip market. AMD said the deal is well on its way to closing by the end of 2021 and the company is making “good progress” in obtaining regulatory approvals.
AMD bought back shares worth $ 750 million in the quarter. AMD stock is up over 30% since the start of the year.