Chip giant AMD (AMD) on Tuesday reported first-quarter earnings that beat analysts’ top- and bottom-line expectations, but weaker-than-expected guidance for the current quarter sent shares tumbling. AMD’s announcement followed a disappointing report from rival Intel last week, in which it issued a weaker-than-expected revenue outlook for the current quarter.
Amdm’s announcement followed a disappointing report from rival Intel last week, in which it issued a weaker-than-expected revenue outlook for the current quarter.
AMD said it expects second-quarter revenue of $5.4 billion to $6 billion; forecasts had called for $5.72 billion. AMD reported adjusted earnings per share (EPS) of $0.62 on revenue of $5.5 billion. Wall Street had expected adjusted EPS of $0.61 on revenue of $5.45 billion. In the same quarter last year, the company reported earnings per share of $0.60 on revenue of $5.35 billion.
The company reported adjusted EPS of $0.60 on revenue of $5.35 billion.
It’s important to note that AMD had higher-than-expected revenue for data centers in the quarter, with the company reporting sales of $2.34 billion.
Wall Street had expected $2.31 billion.
Lisa Su, CEO of AMD, speaks on stage during Vox Media’s 2023 Code Conference at The Ritz-Carlton, Laguna Niguel on September 26, 2023 in Dana Point, California
The AMD MI300 chips are designed to compete with Nvidia’s (NVDA) best-selling H100 line of gas pedals. The company had previously claimed that its MI300X was superior to Nvidia’s chips, but Nvidia has rejected that claim. Intel is also going after Nvidia’s H100 platform with its Gaudi 3 gas pedals. However, at the GTC conference in March, Nvidia announced a sequel to the H100 — the Blackwell platform. This platform should offer better performance than its predecessor.
The platform is expected to offer more performance than its predecessor.
The AI arms race isn’t slowing down anytime soon either. Microsoft (MSFT), Google (GOOG, GOOGL), and Meta* (META*) have all announced that they are investing in AI-powered data centers to support their various software offerings. But whether AMD will be able to wrest significant market share from leader Nvidia remains to be seen. According to UBS Global Research analyst Timothy Arcuri, MI300X sales should bring in billions this year.
According to UBS Global Research analyst Timothy Arcuri.
«We continue to believe MI300 revenue will be between $5 billion and $6 billion this year, and we also believe this is a reasonable guidance» — he wrote in a note to investors before earnings.
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On the PC side, AMD reported customer revenue of $1.37 billion, beating Wall Street forecasts of $1.29 billion.
When it comes to PCs, AMD reported customer revenue of $1.37 billion, beating Wall Street estimates of $1.29 billion.
According to IDC, global PC shipments grew 1.5% in the first quarter of 2024, marking the first quarter of growth after two years of decline. Intel, for its part, reported a 31% year-on-year increase in revenue at Client Group, its PC chip segment, in the latest quarter.
But AMD and Intel — aren’t the only companies claiming a slice of the artificial intelligence PC market. Qualcomm (QCOM) is aiming for its share with its new Snapdragon X Elite and Snapdragon X Plus chips for laptops.
Amazon (QCOM) is also aiming for its share with its new Snapdragon X Elite and Snapdragon X Plus laptop chips.
Gaming and embedded revenue, meanwhile, fell short of Wall Street’s expectations. AMD reported sales of $922 million in gaming solutions in the quarter, less than the $965.5 million analysts expected. Embedded systems revenue totaled $846 million. Analysts had expected sales of $922.6 million.
Amdm.
* Owned by Meta, it is recognized as an extremist organization in Russia and its activities are banned.
By ForGeeks 
