AMD Earnings Beat: Strong Q4, But Data Center Growth Disappoints
After market close on Tuesday, AMD (AMD) reported Q4 earnings that exceeded expectations on both revenue and earnings, and issued a better-than-anticipated Q1 forecast. However, despite the positive results, AMD stock fell nearly 9% on Wednesday pre-market.
Earnings Highlights:
* Earnings per share (EPS): $1.09, beating the consensus estimate of $1.09
* Revenue: $7.56 billion, surpassing expectations of $7.5 billion
Segment Performance:
* Data center: Revenue of $3.9 billion, slightly below expectations of $4.09 billion
* Client (PC chips): Revenue of $2.3 billion, exceeding expectations of $1.98 billion
* Gaming: Revenue of $563 million, outperforming estimates of $487 million
Growth Outlook:
* Q1 2023 revenue guidance: $6.8 billion - $7.4 billion, below Street expectations of $7.0 billion
Market Landscape:
* AMD faces competition from Nvidia (NVDA) in the AI chip space, and from both Nvidia and Intel (INTC) in the PC market.
* President Trump's 10% tariff on Chinese-made goods may impact the broader electronics market, including servers and PCs.
Analyst Commentary:
* Analysts were disappointed by AMD's data center growth forecast, which they see as a potential sign of weakness in AI chip demand.
* AMD's shares have underperformed Nvidia's in the past year, but have outperformed Intel's.
Follow-Up:
Stay tuned for updates on AMD's earnings, market performance, and industry developments.