Advanced Micro Devices (AMD) Inc delivered 71.00% annual sales growth in the first quarter, shrugging off concerns about PC slowdown.
The chipmaker posted revenue of $5.89 billion, well above the average market expectation of $5.52 billion.
Eventually, its earnings came at $1.13 per share, surpassing the forecasted $0.91. This figure also represented a 117.00% year-over-year increase.
AMD’s upbeat results suggested that the chipmaker still grows fiercely. Subsequently, its individual lines of business edged up by double digits during the quarter.
Then, one highlight for the company is its high-end server chip business, which mainly competes with Intel. Reports have shown that the firm has taken its market share from its rival while trying to get its manufacturing foothold back.
The upturn came as analysts anticipated PC sales to shrink this year after two years. In addition, investors believed that the pandemic boom was over.
Nevertheless, AMD, which supplies the processor at the heart of many laptops and desktops, remained unaffected. Its CEO Lisa Su said that the business still focuses on the market’s premium, gaming, and commercial portions.
The firm expected the sector to see solid growth opportunities and continue to gain overall client revenue share.
Accordingly, PC sales in AMD’s computing and graphics segment rose 33.00% YoY. The unit also marked an 8.00% jump from the December quarter.
The firm explained that the increase benefitted both by central processors and graphic processor sales. At the same time, the average sales price for Ryzen processors ticked up during the quarter.
Likewise, cloud server sales in the Embedded, Enterprise, and Semi-custom segment climbed 88.00% to $2.50 billion. Again, this rise came from higher server processor profit, which is the chips used in game consoles like the PlayStation 5.
AMD stocks rise on upbeat forecast
Correspondingly, AMD provided a strong sales forecast for the current quarter. The tech firm predicted Q2 sales of $6.50 billion, outpacing the average analyst estimate of $6.03 billion.
This rosy outlook helped send the company’s stock to a gain of 6.77% or 6.17 points to $97.30 per share.
At the same time, this guidance indicated that the chipmaker continues to make strides in the most lucrative industry.
Moreover, AMD’s forecast contrasts with a recent projection from Intel. The accumulation of inventory at several PC customers heavily hit its competitor.
Eventually, the return of Covid-related lockdowns in some Chinese cities weighed on the supply of components needed to complete devices.
Furthermore, other semiconductor companies like Texas Instruments Inc stated that those disruptions also weigh on growth.
