AMD reports profit beat, but misses on data center revenue
Advanced Micro Devices reported fourth-quarter results on Tuesday that beat Wall Street expectations for sales and earnings, but the stock fell about 6% in extended trading as the company missed estimates in its key data center segment.
Here's how the chipmaker did, versus LSEG consensus estimates for the quarter ended Dec. 28:
AMD said it expects $7.1 billion in sales in the first quarter, plus or minus $300 million. It projected its gross margin to be about 54%. Analysts expected AMD to guide for revenue of $7 billion.
AMD reported $482 million in net income, or 29 cents per share, for the fourth quarter, down from $667 million, or 41 cents per share in the year-ago period.The company's adjusted earnings per share excluded items such as acquisition costs, inventory loss at contract manufacturers, and restructuring charges.
Su told investors on an earnings call that AMD believes it will report "strong double-digit percentage revenue and EPS growth" in 2025.
The company's most important unit is its business selling chips for data centers, which has been growing in recent quarters, thanks to demand for its graphics processing units for artificial intelligence.
AMD reported $3.86 billion in data center sales, which was up 69% on a year-over-year basis. The company said the increase was due to sales both in its Instinct GPUs and its EPYC CPUs, which compete with Intel's processors.
However, analysts polled by FactSet were predicting $4.14 billion in data center sales during the quarter.
For the full year, AMD's data center division revenue increased 94% to $12.6 billion. AMD said that $5 billion of those sales were from its Instinct GPUs for AI.
While AMD is far behind market leader Nvidia, it's released competitive data center