AMD earnings for the third quarter of 2021

AMD reported its third-quarter income after the bell on Tuesday, with income and earnings beating analysts’ expectancies, and a forged forecast for the fourth quarter.

The inventory is up up to 1% in prolonged buying and selling.

This is how the chipmaker carried out towards the Refinitiv consensus estimates for the quarter finishing October 2d:

  • EPS: $zero.73, adjusted, as opposed to $zero.67 anticipated, up 16% year-over-year.
  • Revenues: $four.31 billion, as opposed to $four.12 billion anticipated, up 54% year-over-year

AMD mentioned it anticipated gross sales of $four.five billion within the fourth quarter, topping analysts’ expectancies of about $four.25 billion in gross sales this quarter. AMD expects 39% annual expansion within the fourth quarter.

AMD is without doubt one of the firms that has benefited essentially the most from the rise in electronics gross sales over the last 18 months as its central processors and graphics processors energy computer systems, servers, and recreation consoles. Those gross sales have been recorded by way of AMD’s computing and graphics department, which generated $2.four billion in earnings, up 44% yr over yr.

The PC marketplace has slowed from its blistering tempo a yr in the past when folks all over the world nonetheless wanted computer systems to paintings or be told from house, however AMD mentioned its chips are promoting at upper moderate costs as shoppers make a choice extra robust processors.

AMD experiences on gross sales of server and console chips in its embedded, undertaking, and semi-dedicated segments. AMD reported $1.nine billion in gross sales on this vital class, a 69% year-over-year building up pushed by way of Epyc server chips and better gross sales of “semi-dedicated,” the semiconductor it sells to recreation console makers.

AMD is within the strategy of gaining marketplace percentage within the server marketplace in the back of its Epyc processors, as giants like Microsoft and Google purchase its chips to energy their cloud services and products. Lisa Su, AMD’s CEO, mentioned in a observation that knowledge heart gross sales doubled year-over-year and now constitute the “mid-20s” of AMD’s overall earnings.

In the meantime, recreation consoles, corresponding to Sony’s Ps five and new Microsoft Xbox fashions, stay in top call for and difficult to search out as a result of they promote out briefly. Likewise, AMD graphics and CPUs are exhausting to search out in inventory in shops.

“Semi-allocated earnings has grown sequentially and year-over-year as call for for the newest Microsoft and Sony hardware stays very robust,” Su mentioned on a choice with analysts on Tuesday. “We predict semi-allocated earnings to extend sequentially within the fourth quarter as provide will increase to fulfill persisted call for for recreation consoles.”

AMD is a fables chip corporate. It designs generation inside semiconductors and outsources production to foundry companions corresponding to TSMC and GlobalFoundries. In September, AMD CEO Su mentioned she anticipated the chip scarcity to develop into much less critical in 2022.

AMD continues to stay its prices in take a look at and building up its profitability. It mentioned its gross margin was once 48%, up from 44% in the similar duration ultimate yr as a result of shoppers are purchasing dearer processors. It forecast gross benefit margins of 49.five% within the fourth quarter. AMD’s web source of revenue for the quarter was once $893 million.

Remaining October, AMD introduced its plans to shop for Xilinix in a $35 billion deal that may give the corporate extra firepower to compete with Intel within the knowledge heart chip marketplace. AMD mentioned the deal was once nonetheless heading in the right direction to near by way of the tip of 2021 and that the corporate was once making “just right growth” in securing regulatory approvals.

AMD mentioned it repurchased $750 million of inventory all the way through the quarter. AMD inventory is up over 30% for the reason that starting of the yr.

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