amd’s-q2-2021-income-grew-99%-to-$3.85b-on-market-share-features

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Advanced Micro Devices reported its revenues and earnings for the second quarter ended June 30 exceeded expectations with income rising 99% to $3.85 billion.

Non-GAAP internet earnings for the quarter was $778 million, or 63 cents a share, beating expectations of 54 cents a share on a non-GAAP foundation. AMD mentioned it was growing its annual earnings forecast and its shares are up 1% to $91.93 a share in after-hours buying and selling.

The Santa Clara, California-based firm has had a very good run on momentum behind its Zen and Zen 2 architectures for processors, which might generate 50% or extra higher efficiency per clock cycle than the earlier technology. This structure put AMD forward of Intel in efficiency for the primary time in a decade and it has helped the perennial No. 2 PC chip maker right into a fast-growing contender towards Intel.

Intel, in the meantime, has had stumbles not solely on the chip design aspect but additionally in manufacturing, the place it has misplaced its technological benefit to rivals similar to TSMC, which makes each processors and graphics chips for AMD. As a outcome, AMD has been making historic market share features for the previous three years. What’s fascinating is AMD has been making these features amid a historic chip scarcity pushed by the provision whipsaw from the pandemic and unprecedented demand for digital items.

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“Our business performed exceptionally well in the second quarter as revenue and operating margin doubled and profitability more than tripled year-over-year,” mentioned AMD Lisa Su, in an announcement. “We are growing significantly faster than the market with strong demand across all of our businesses. We now expect our 2021 annual revenue to grow by approximately 60% year-over-year driven by strong execution and increased customer preference for our leadership products.”

Intel, in the meantime, is doubling down on its manufacturing investments as a solution to keep aggressive and reap the benefits of the chip increase and provide scarcity.

Q2 2021 outcomes

Min-Liang Tan holds the Razer Blade 14 with an AMD processor and Nvidia GeForce 3080 RTX graphics.

Above: Min-Liang Tan holds the Razer Blade 14 with an AMD processor and Nvidia GeForce 3080 RTX graphics.

Image Credit: Razer

As famous, income was $3.85 billion, up 99% year-over-year and 12% quarter-over-quarter. That was pushed by increased income in each the computing and graphics section, in addition to development within the enterprise, embedded, and semi-custom segments. Analysts had anticipated revenues of $3.62 billion.

The gross revenue margin was 48%, up 4 proportion factors year-over-year and a couple of proportion factors quarter-over-quarter. The will increase have been pushed by a richer mixture of gross sales, together with high-end Ryzen, Radeon, and Epyc processor gross sales. That means AMD is doing properly throughout the board.

Non-GAAP internet earnings was $778 million in comparison with $216 million a 12 months in the past and $642 million within the prior quarter. Non-GAAP diluted earnings per share was 63 cents in comparison with 18 cents a 12 months in the past and 52 cents within the prior quarter.

AMD now has $3.79 billion in money, money equivalents and short-term investments. Cash is coming into the corporate at a charge of $952 million per quarter, in comparison with $243 million a 12 months in the past and $898 million within the prior quarter.

Quarterly monetary section abstract

AMD's Radeon RX 6800M GPU.

Above: AMD’s Radeon RX 6800M GPU.

Image Credit: AMD

Computing and graphics section income was $2.25 billion, up 65% year-over-year and seven% quarter-over-quarter pushed by increased shopper and graphics processor gross sales. Client processor common promoting worth (ASP) grew year-over-year and quarter-over-quarter pushed by a richer mixture of Ryzen desktop and pocket book processor gross sales. It was the fifth straight quarter of document processor income.

Graphics processing unit (GPU) ASP grew year-over-year and quarter-over-quarter pushed by high-end graphics product gross sales, together with information middle GPU gross sales. Operating earnings was $526 million in comparison with $200 million a 12 months in the past and $485 million within the prior quarter. The will increase have been primarily pushed by increased income.

Enterprise, embedded and semi-custom section income was $1.6 billion, up 183% year-over-year and 19% quarter-over-quarter. The will increase have been pushed by increased Epyc processor income and semi-custom product gross sales. The semi-custom merchandise embrace processors for the PlayStation 5 and Xbox Series X/S sport consoles.

Current outlook

HPE Cray EX supercomputer uses AMD chips.

Above: HPE Cray EX supercomputer makes use of AMD chips.

Image Credit: HPE

For the third quarter of 2021, AMD expects income to be roughly $4.1 billion, plus or minus $100 million, a rise of roughly 46% year-over-year and roughly 6% quarter-over-quarter. The year-over-year enhance is predicted to be pushed by development throughout all companies. The quarter-over-quarter enhance is predicted to be primarily pushed by development in AMD’s datacenter and gaming companies. AMD expects non-GAAP gross margin to be roughly 48% within the third quarter of 2021.

For the total 12 months 2021, AMD now expects income development of roughly 60%, up from prior steering of roughly 50%, pushed by sturdy development throughout all companies. AMD now expects non-GAAP gross margin to be roughly 48% for the total 12 months 2021, up from prior steering of 47%.

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