Start transforming your game’s economy and increase your bottom line. Get the free guide now. Elevate your enterprise data technology and strategy at Transform 2021. Advanced Micro Devices met its reduced expectations for earnings and revenues in the fourth quarter, despite fears that it could be bad news. The Santa Clara, California-based maker of PC processors and graphics chips said revenue was up 6 percent from a year ago to $1.42 billion, slightly off from expectations, while earnings per share were 8 cents, about flat compared to a year ago. In after-hours trading, AMD’s stock price was up 3.5 percent. For the first quarter ending March 31, AMD expects revenue to be $1.25 billion and non-GAAP gross profit margin to be about 41 percent, or the same as in the fourth quarter. For the full year, AMD expects single-digit revenue growth for revenues, and that non-GAAP gross profit margin will be more than 41 percent. AMD said that it expects “continued softness” in the graphics channel and seasonality across businesses in the first quarter. After AMD missed earnings in the previous quarter ended September 30, analysts adjusted their expectations downward. For the fourth quarter, AMD was expected to hit the revised targets of 8 cents non-GAAP earnings per share on revenues of $1.45 billion. “In 2018, we delivered our second straight year of significant revenue growth, market share gains, expanded gross margin and improved profitability based on our high-performance products,” said Lisa Su, CEO of AMD, in a statement. ” Importantly, we more than doubled our Epyc [server] processor shipments sequentially and delivered record GPU data center revenue in the quarter. Despite near-term graphics headwinds, 2019 is shaping up to be another exciting year driven by the launch of our broadest and most competitive product portfolio ever with our next-generation 7-nanometer Ryzen, Radeon, and Epyc products.” For 2018, AMD reported revenue of $6.48 billion, up 23 percent from a year earlier. Net income was $337 million, or 32 cents a share, compared with a loss of $33 million, or 3 cents a share a year earlier. Image Credit: Dean Takahashi Things have been looking up for AMD, as Su said in AMD’s first-ever keynote speech at the recent CES 2019 tech trade show in Las Vegas. The company launched its Zen-based Ryzen processors in the spring of 2017, getting a jump on Intel for once with processors that could handle 52 percent more instructions per clock cycle than the previous generation. It took about five years to design AMD’s Zen core, which can generate 52 percent better performance per clock cycle than its predecessor. And AMD has introduced 10 different families of chips based on the Zen architecture since 2017. Those PCs can do things like wake up with voice commands, last 12 hours doing productivity work, and enable gaming on laptops. AMD’s rival Intel reported weaker-than-expected quarters for the end of the year. Intel hit its Q4 profit targets, but revenue was lower than predicted, due in part to PC chip shortages and lower data center demand. Nvidia formally announced earnings on February 14, but it preannounced weak results on Monday. Nvidia was hampered by the cryptocurrency bust, which has decreased demand for GPUs for crypto mining, as well as weaker-than-expected demand for gaming GPUs such as its new RTX cards. Data center demand was also weak. Back in October, AMD said it had lower-than-expected GPU sales as the cryptocurrency boom came to an end. Nvidia subsequently blamed its earnings slip on AMD flooding the market with mid-range graphics chips as well as the crypto bust. It’s hard to see how much harm the crypto bust has done since the crypto bubble began deflating a year ago and it was supposedly never more than 10 percent of GPU sales. But Nvidia said this week that revenue was weak in part because of concerns around the economy, particularly due to trade worries with China in the midst of a tariff war with the U.S. Gaming revenue was also weaker due to slow adoption of Nvidia’s new RTX cards, which are very different in that they support real-time ray tracing. AMD’s new GPUs coming February — the Radeon VII — do not support real-time ray tracing. Nvidia hopes that real-time ray tracing will take off as more games utilize it. The 7-nanometer Radeon VII chips offer a 27 percent to 62 percent boost in graphics performance versus the previous generation, and they go on sale on February 7 at $700, or below the price Nvidia is charging for its high-end GPUs. For the coming quarter, AMD said that semi-custom revenue (mostly chips for game consoles) will be down in the full year, while Ryzen, Epyc, and data center GPUs will be up. AMD now has $1.16 billion in cash.<doc-sep>AMD shares surged Wednesday after the chipmaker posted solid quarterly earnings and said 2019 margins and revenues would likely top forecasts, defying investor gloom for the sector following Nvidia's sales warning earlier this week. Advanced Micro Devices (AMD) - Get Report shares surged Wednesday after the chipmaker posted solid quarterly earnings and said 2019 margins and revenues would likely top forecasts, defying investor gloom for the sector following Nvidia Corp.'s (NVDA) - Get Report sales warning earlier this week. AMD said non-GAAP earnings for the three months in December came in at 8 cents per share, matching the Street consensus and rising from 1 cent per share over the same period last year. Group revenues jumped 5.9% to $1.419 billion, AMD said, but that figure narrowly missed the $1.44 billion consensus estimates. However, AMD said graphic and data center chip demand would support 2019 sales, with the company suggesting a "high single digit" growth rate, with an adjusted gross profit margin of around 41%, the highest in eight years. "2018 was another strong year for AMD. Increased adoption of our high performance products drove a second straight year of double-digit annual revenue growth, expanded gross margins and improved profitability," CEO Lisa Su told investors on a conference call late Tuesday. "While headwinds remain in the graphics channel and macro uncertainties are causing some caution in the first half of 2019, we believe we are well positioned to gain share throughout the year and accelerate growth as we ramp our next generation 7 nanometer products." AMD shares were marked 14.7% higher in the opening minutes of trading Wednesday to change hands at $22.09 each, a move that would extend the stock's three-month gain to around 21% compared to a 34.5% decline for the Philadelphia Semiconductor Sector benchmark. Chip and data center sales rose 9% to $986 billion in the fourth quarter, AMD said, driven by strong Ryzen desktop product sales and the adoption of second generation Ryzen mobile processors. Graphics sales fell due to "negligible Blockchain related revenue in the fourth quarter", AMD said, as well as "elevated levels of Graphics inventory in the channel." Earlier this week, Nvidia shares plunged after the chipmaker cautioned that quarterly revenues would fall far short of analysts forecasts following weaker-than-expected demand for its gaming and datacenter products and slowing growth in China. Nvidia said sales for the three months ended on Jan. 27, its fiscal fourth quarter, would come in at $2.2 billion compared to earlier guidance of $2.7 billion. The company also said GAAP and non-GAAP margins would be hit by charges of around $120 million, adding that after a number of deals for its latest Turing graphics chips failed to close over the final months of the year as customers potentially waited for lower prices and demonstrations of the technology in actual games. Last week, ASML Holding NV (ASML) - Get Report , the Dutch semiconductor supplier, cautioned that delayed orders and swelling inventories would hit first quarter sales, echoing concerns for the sector as chip prices fall and smartphone demand wanes. Taiwan Semiconductor Mfg. Co. Ltd., (TSM) - Get Report the world's biggest contract chipmaker and a lead supplier for Apple Inc. (AAPL) - Get Report iPhones, cautioned that near-term sales would slide the most in 10 years as global smartphone markets continue to slow. "Moving into first quarter 2019, we anticipate our business will be dampened by the overall weakening of the macroeconomic outlook, mobile product seasonality, and high levels of inventory in the semiconductor supply chain," said CFO Lora Ho, with chairman Mark Liu telling reporters that drop in high-end smartphone demand "came a little bit sudden", adding that the inventory in the supply chain is quite a lot."<doc-sep>AMD met earnings estimates, but came in light on revenue. Shares of Advanced Micro Devices Inc. (AMD) - Get Report rose sharply after the chip maker reported fourth quarter earnings that met estimates but revenue that missed. The stock was rising 7% to $20.66 a share in after hours trading on Tuesday, after having fallen 4.61% to $19.25 in regular hours trading. AMD posted adjusted earnings-per-share of 8 cents, in line with estimates of an adjusted 8 cents. Revenue was $1.42 billion, slightly below estimates for $1.44 billion. Computing and graphics revenue was $986 million, beating estimates of $939 million. Enterprise embedded and semi-custom revenue was $433 million, below estimates of $494 million. Management guided for first quarter 2019 revenue of roughly $1.25 billion, plus or minus $50 million, below estimates of $1.47 billion. AMD expects adjusted gross margins to be about 41% for the upcoming quarter. That's slightly higher than the expected 40.5% gross margin. "Despite near-term graphics headwinds, 2019 is shaping up to be another exciting year driven by the launch of our broadest and most competitive product portfolio ever with our next-generation 7nm Ryzen, Radeon and EPYC products," said Dr. Lisa Su, AMD president and CEO, in a press release. AMD shares have risen 2.2% this year. Rival chipmaker Nvidia (NVDA) - Get Report pre-announced much weaker-than-expected results for its fourth quarter on Monday.<doc-sep>
AMD AMD posted mixed quarterly results. The company's revenue guidance for the quarter missed Wall Street expectations. Shares gained as much as 7% after the results. Watch AMD trade live. AMD on Tuesday announced mixed fourth-quarter results and guidance that fell short of Wall Street expectations, but beaten down shares were up 5.4% after the report. Here are the key numbers compared to the Bloomberg consensus: Adjusted earnings per share: $0.08 versus an expected $0.08. Revenue: $1.42 billion versus an expected $1.44 billion. $1.42 billion versus an expected First-quarter revenue guidance: $1.2 billion to $1.3 billion versus an expected $1.47 billion. AMD also said it expects full-year 2019 revenue to grow by a high single-digit percentage, driven by Ryzen, EPYC, and Radeon datacenter GPU product sales as the company ramps up its 7-nanometer products throughout the year. The company also sees the non-GAAP gross margin to be greater than 41% for 2019. "In 2018 we delivered our second straight year of significant revenue growth, market share gains, expanded gross margin and improved profitability based on our high-performance products," CEO Lisa Su said in a press release. "Importantly, we more than doubled our EPYC processor shipments sequentially and delivered record GPU datacenter revenue in the quarter." She added: "Despite near-term graphics headwinds, 2019 is shaping up to be another exciting year driven by the launch of our broadest and most competitive product portfolio ever with our next-generation 7nm Ryzen, Radeon, and EPYC products." Ahead of the results, shares had plunged 5% on Tuesday — one day after rival Nvidia warned that conditions in China had led to an "extraordinary, unusually turbulent" quarter. The chipmaker cut its revenue guidance for the fourth quarter to roughly $2.2 billion, down from about $2.7 billion. And one Wall Street analyst thought the warning from Nvidia could indicate an earnings miss for AMD. "While the other shoe has dropped at NVIDIA, we think AMD is further behind in working through its GPU inventory issues," Susquehanna International Group analyst Christoper Rolland wrote ahead of the report. "For AMD, we note evidence of continuing retail price declines suggesting its graphics card channel has yet to clear. Additionally, we note Street expectations for Computing and Graphics in 1Q19 of +3% that are well above typical seasonality (we would not be surprised to see a mid-single digit decline or even worse here). With the additional negative commentary describing a deteriorating macro picture and Chinese gaming at NVIDIA, we continue to believe that AMD is at significant risk of a miss in 4Q18/1Q19." AMD shares gained 45% over the past 12 months. Now read: Markets Insider NOW WATCH: What will happen when Earth's north and south poles flip