[Financial Summary] AMD starts chasing NVIDIA! Sales of AI semiconductors are at a record high, and forecasts have also been revised upward

●Strong results for the April-6 fiscal year (2Q)
◇Total sales, sales of all divisions, and adjusted EPS exceed market expectations
(EPS earnings per share)

◇The data center division was particularly strong with a 115% increase in sales, driving growth
◇The client division is strong with 49% increase in sales
(The rate of increase in sales compared to the same period last year)

●Guidance is also above expectations
◇Sales for the fiscal year ending July-9 (3Q): 67 ± 0.3 billion dollars, market forecast: 6.62 billion dollars, higher than market expectations at median value
◇The full-year GPU sales forecast for the data center division was revised upward from 4 billion dollars to 4.5 billion dollars, and the AI semiconductor MI300 performed well

●The data center division is doing well, and the introduction of AI semiconductors is expanding
◇turnover
Sales in the data center division reached a record high, and the rapid increase in shipments of the AI semiconductor MI300 contributed. MI300's quarterly sales surpassed 1 billion dollars for the first time.

◇Product roadmap
Starting with the release of the MI325X later this year,We provide AI accelerators every yearI plan to do it. Utilizing the same infrastructure as the MI300, the MI325X can provide twice the memory capacity and 1.3 times the peak computing performance compared to competitive products. Following the MI325X, the MI350 series based on the new CDNA 4 architecture is scheduled to be released in 2025. This series is expected to improve performance by 35 times compared to CDNA 3. Development of the Mi400 series, which is equipped with the CDNA NEXT architecture, is also progressing greatly, and it is scheduled to be released in 2026.

● CEO Lisa Hsu's main comments at the financial results briefing
◇Customer response to our multi-year Instinct and ROCM roadmap has been overwhelmingly “positive.” MI300 sales are expected to continue to increase in the 3rd and 4th quarter. Next year, we plan to release the Mi350 series, which is highly competitive with (NVIDIA's) Blackwell solutions.

◇As for the supply side of the MI300, significant progress was made in the 2nd quarter, and the supply volume increased to more than 1 billion dollars on a quarterly basis. We plan to continue to increase supply volume in the second half of this year. Overall, however, the supply chain is tight. The tight state is expected to continue until 2025. We have built excellent partnerships across our supply chain and will continue to expand production in the latter half of the year.

◇We are beginning to see very good traction in the enterprise sector, with both new and existing customers. Also, third-party cloud adoption is showing similarly strong growth. Overall, therefore, our EPYC portfolio is performing well.

◇The overall view on AI investment is that it must be invested. In other words, the industry must invest. The potential of AI is so great that it affects everything, such as how companies operate. Therefore, we anticipate that the investment cycle will continue steadily in the future. Also, with regard to various options, I am convinced that there are multiple solutions for custom chips and ASICs, depending on the size of the market. In our case, I think we've already demonstrated a very strong roadmap and ability to work well with our customers. GPUs are still the optimal architecture for large-scale language models, and I think the business opportunities are huge.

NVIDIA's back is still a long way off in the AI semiconductor market, but AMD is one step ahead
There are two major differences when compared to financial results announcements in April this year and this time.

1) When financial results were announced in April, market expectations were high for the AI semiconductor MI300X, but the company presented a sales forecast lower than expected, which led to disappointment among investors. This time, the opposite happened. In other words, while market expectations were declining, the company showed new acquisitions and sales forecasts that exceeded expectations. The sales scale of AI semiconductors is still small compared to NVIDIA, but it is expected to grow steadily.

2) From CEO Lisa Hsu's remarks at the financial results briefing, it was evident that the level of confidence was increasing. In April, vague expressions such as “implementation is going well” and “plans to increase supply” stood out, and I had the impression that they asked investors for patience. This time, results were shown with specific numbers, and product roadmaps and customer pipelines were also presented. Last time, CEO Sue stated that “it is not expected that there will be a 'total winner' (NVIDIA one person wins) in the AI semiconductor market, and AMD can gain a fixed share,” but it seems that this is becoming a reality.