AMD - Why the difference with NVIDIA?
$Advanced Micro Devices(AMD.US$ released its latest Q1'23 results.
Share prices went down after that.
Compared to its arch rivals $NVIDIA(NVDA.US$which seem to be enjoying more prospects, why has this other GPU maker shared a different fate?
1. Client segment is a major drag
![Source: AMD Q1'23 results presentation](https://sgsnsimg.moomoo.com/102263458/editor_image/63674ed10a67322793ff8ac16a5150fb.png/bigmoo)
AMD's strength lies in having chips embedded in various consumer electronics.
During the WFH boom, AMD rode on the catalyst.
But as chip supply is deemed surplus now, a glimpse of $Taiwan Semiconductor(TSM.US$ results would have offered some key clues of AMD's Q1'23 performances.
The Client segment made up 36% of Q1'22's revenue. So any hiccups would be as detrimental as what we have observed.
2. Shrinking gross margins
![Source: AMD Q1'23 results presentation](https://sgsnsimg.moomoo.com/102263458/editor_image/0d95d550ea943e4ba493837c5cc33c25.png/bigmoo)
Gross margins also took a hit if we looked at the recent quarters.
Undoubtedly the shrinking gross margin stopped at 42% in Q3'22 and starts to stabilize, but YoY wise it is still down by 4 percentage points.
A shrinking revenue and gross margin is indeed a double whammy.
3. Lacking the AI magic powder
![Source: AMD Q1'23 results presentation](https://sgsnsimg.moomoo.com/102263458/editor_image/bb6225a8eaa232cebc1575b4eff130d0.png/bigmoo)
Now it isn't true to say that AMD chips are not used for AI. In its Embedded business segment, there are some AMD chips used in Subaru vehicles.
![Source: AMD Q1'23 results presentation](https://sgsnsimg.moomoo.com/102263458/editor_image/7ea5ad7488a23644a49abb6ad44f3dd7.png/bigmoo)
But when it comes to higher-end AI-related prospects, AMD seems to be firing blanks at the moment.
DISCLAIMER
The information available in this article/report/analysis is for sharing and education purposes only. This is neither a recommendation to purchase or sell any of the shares, securities, or other instruments mentioned; nor can it be treated as professional advice to buy, sell or take a position in any shares, securities, or other instruments. If you need specific investment advice, please consult the relevant professional investment advice and/or for study or research only.
The information available in this article/report/analysis is for sharing and education purposes only. This is neither a recommendation to purchase or sell any of the shares, securities, or other instruments mentioned; nor can it be treated as professional advice to buy, sell or take a position in any shares, securities, or other instruments. If you need specific investment advice, please consult the relevant professional investment advice and/or for study or research only.
Disclaimer: Community is offered by Moomoo Technologies Inc. and is for educational purposes only.
Read more
Comment
Sign in to post a comment
73528731 : I don't have anyone who doesn't want