From CNBC:

AMD’s earnings were in line with analysts’ predictions, and revenue beat estimates. However, its first-quarter forecast fell short of expectations, causing a more than 6% drop in AMD stock during extended trading. AMD expects about $5.4 billion in sales for the first quarter, falling below analysts’ forecasts of $5.73 billion in revenue. REGARDING AI chips specifically, they expect significant growth in the company’s data center segment, with $3.5 billion in data center GPU sales under its “Instinct” brand expected this year.

AMD CEO Lisa Su remains positive about the demand environment for 2024, though the company expects some major businesses, notably PC chips, to decline sequentially during the quarter. Nevertheless, net income for the fourth quarter was significantly higher than the previous year, reaching $667 million, or 41 cents per share, versus $21 million, or 1 cent per share.

The increase in net income was mainly due to significant growth in sales of its AI chips. AMD’s data center business, a segment which includes server CPUs and AI chips, rose 38% year on year to hit $2.28 billion in sales, making it the company’s largest segment. Sales in the client segment, which includes chips for PCs and laptops, also rose 62% year over year to $1.46 billion in sales.

On the other hand, sales in AMD’s gaming segment fell 17% and semi-custom revenue is anticipated to decline significantly in the current quarter. The embedded segment, which includes chips for networking, reported $1.1 billion in sales, down 24% year on year.

For 2024, AMD expects a mixed demand environment and foresees the decline in some major businesses, notably PC chips and a significant double-digit percentage decline in semi-custom revenue.



Read more: AMD earnings report Q4 2023