[Moo Brief] AMD spikes 10% on robust Q2 chip sales: Rebound just begins?
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Mooers, did $Advanced Micro Devices (AMD.US)$'s Q2 results strike your expectations? $Advanced Micro Devices (AMD.US)$ exceeded Q2 revenue and profit expectations, boosting market confidence in its chips.
In the fiscal second quarter of 2024, $Advanced Micro Devices (AMD.US)$'s revenue increased by 9% YoY to $5.8 billion, with 48% coming from data center business, 26% from client chip business, and 26% from gaming and embedded chip businesses. Gross margin grew by 3 pct YoY to 49%, and net income surged by a remarkable 881% to $265 million compared to Q2 2023. Earnings per share were $0.69, higher than the expected $0.68.
$Advanced Micro Devices (AMD.US)$'s data center business doubled during the quarter, and the growth was mainly attributed to a chip: Instinct MI300, which competes with $NVIDIA (NVDA.US)$'s influential H100 AI chip. According to CEO Lisa Su, this chip generated over $1 billion in sales in just one quarter, surpassing the milestone of $1 billion in cumulative sales since its debut in December 2023.
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After the results announcement, $Advanced Micro Devices (AMD.US)$ rose 10% to $149.02 after-hour at 7:59 PM EDT on July 30. Raymond James analyst Srini Pajjuri rates AMD as "outperform/hold," projecting Q2 revenue of $900 million for its MI300 AI accelerator product.
What's behind the 800% increased net income?
✎ Data center
As the biggest revenue driver, data center revenue doubled QoQ, growing by 115% to $2.83 billion and setting a historic new high.
Due to the strong demand for computing power and training driven by the development of AI, many tech companies need to purchase chips to ensure the operation of their data centers. $Advanced Micro Devices (AMD.US)$'s cost-effective chips are meeting the high demand for customer purchases, leading to a doubling of its revenue growth in the second quarter.
Going forward, revenue from $Advanced Micro Devices (AMD.US)$'s Instinct GPU and EPYC CPU will remain strong. $Advanced Micro Devices (AMD.US)$ has also pledged to release new AI chips every year to catch up with industry leader $NVIDIA (NVDA.US)$.
✎ Client
The strong performance of Ryzen processors has driven the revenue growth of PC client chips, and the future looks promising.
Q2 client revenue was $1.5 billion, a YoY increase of 49% and a QoQ increase of 9%, mainly driven by the recovery of the personal computer market after the most severe decline in many years. The new AI capabilities for computing are revitalizing consumer demand.
✎ Embedded & Gaming
Although gaming revenue decreased by 59% due to poor sales of PlayStation and Xbox, $Advanced Micro Devices (AMD.US)$ reported that its Radeon 6000 GPU sales actually increased YoY.
Outlook: Increase strategic AI investments to lay the foundation for future growth.
It seems $Advanced Micro Devices (AMD.US)$ is following a similar path as $NVIDIA (NVDA.US)$, which has profited greatly from its H100 and now manufactures new AI chips every year, accelerating all research and development to stay ahead and focusing on high-demand products. AMD CEO Lisa Su stated in Tuesday's earnings call that the company is raising its 2024 AI chip revenue forecast from $4 billion to $4.5 billion. Su said that the supply of such chips will remain tight until 2025.
AMD also plans to release new AI chips every year. During today's earnings call, $Advanced Micro Devices (AMD.US)$ reiterated that it will release the MI325X in Q4 2021, the MI350 in 2025, and the MI400 in 2026. Lisa Su stated that the MI350 should be competitive with $NVIDIA (NVDA.US)$'s Blackwell, which was announced in March as the world's most powerful AI chip and has recently begun to offer samples to buyers.
Does $Advanced Micro Devices (AMD.US)$'s Q2 financial report reflect its position as the so-called "second chip company in the market?" Do you have a bearish or bullish attitude towards $Advanced Micro Devices (AMD.US)$? ![]()
Please drop your answer with reasonable comments, and you will receive 66 points. ![]()
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WanEH : AMD show the great quarter report compare to last year. the AI chips has the excellent calculation power and the price is cheaper compare to Nvidia. So i'm looking good to AMD in long term.
On Paris : GOOD MORNING
mr_cashcow : $Advanced Micro Devices (AMD.US)$ recent earnings reports shows positive numbers and with Intel scrwwing up big time I foresee a huge potential for AMD to pull ahead in their retail consumer sector especially with their release of their new RYZEN chips for retail consumers![[undefined]](https://static.moomoo.com/nnq/emoji/static/image/default/default-black.png?imageMogr2/thumbnail/36x36 "undefined")
Long term wise AMD is not going anywhere so I'm bullish![[undefined]](https://static.moomoo.com/nnq/emoji/static/image/default/default-black.png?imageMogr2/thumbnail/36x36 "undefined")
![[undefined]](https://static.moomoo.com/nnq/emoji/static/image/default/default-black.png?imageMogr2/thumbnail/36x36 "undefined")
Although my opinion is strongly bias since I use AMD chips for my gaming pc![[undefined]](https://static.moomoo.com/nnq/emoji/static/image/default/default-black.png?imageMogr2/thumbnail/36x36 "undefined")
102362254 : I've a bullish attitude towards AMD. Their Q2 financial report showcases strong performance, with revenue hitting $5.8 billion and significant growth in the Data Center and client segments. Their strategic investments in AI and high-performance computing strengthen their competitive edge.
LCS168 : If AMD can continue to expand its AI chip business and successfully capture more market share from Nvidia, it is expected to improve its stock price performance. However, market expectations for the AI and data center businesses are very high, so AMD needs to continue to innovate and improve product competitiveness to maintain growth momentum
ChengHoe : AMD CEO Lisa Su said the company expects data center GPU revenue to exceed $4.5 billion in 2024, higher than previous expectations. AMD's progress in the field of AI chips, especially the performance of the MI300X chip, provides strong support for the company's future growth. I look good AMD.
FEN988 : This is too great that AMD give a good quarter result, wishes that AMD continuing to produce quarter result like constant increasing.