AMD soars on Nasdaq after hiking AI chip revenue forecast
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The news: Shares in Advanced Micro Devices rocketed in after-hours trading on the Nasdaq after the US chip maker beat Q2 earnings estimates and hiked its full-year revenue target for AI processors.
The numbers: AMD shares were up 7.5% to USD148.77 ($227.49) by 8:30am AEST in extended trading after the earnings announcement.
The California-based company reported a revenue of USD5.8 billion in Q2, up 9% year on year and above consensus estimates of USD5.72 billion, according to Reuters.
AMD posted record data centre revenue, which rose 115% to USD2.8 billion. Client segment revenue gained 49%, driven by sales of its Ryzen AI chips. Diluted earnings per share totalled 69 US cents, beating consensus estimates of 68 US cents.
In a conference call, AMD CEO Lisa Su said the company is hiking its full-year AI chip revenue forecast from USD4 billion to USD4.5 billion. It also anticipates Q3 total revenue of USD6.7 billion, compared with consensus estimates of USD6.61 billion, according to LSEG data.
The context: AMD's latest result shows that the company is continuing to benefit from surging demand from large cloud operators, such as Microsoft and Meta Platforms, for its AI processors.
As one of the world's largest providers of PC chips, AMD has also been boosted by a recent recovery in the personal computer market, as tech companies lay out initial strategies for AI-capable PCs.
What they said: "We delivered strong revenue and earnings growth in the second quarter driven by record Data Center segment revenue," Su said.
"Our AI business continued accelerating and we are well positioned to deliver strong revenue growth in the second half of the year led by demand for Instinct, EPYC and Ryzen processors," she said.
"The rapid advances in generative AI are driving demand for more compute in every market, creating significant growth opportunities as we deliver leadership AI solutions across our business."
The sources: AMD earnings release, Reuters
