AMD bulls are hoping stock gains and cloud momentum will more than offset headwinds from slowing consumer tech spending, the company reported Tuesday afternoon.
The consensus among analysts polled by FactSet was that AMD reported second-quarter revenue of $6.53 billion (up 70% annually from both organic growth and the Xilinx acquisition) and non-GAAP EPS of $1.03.
AMD typically provides quarterly and full-year sales forecasts in its reports. The company’s expected revenue for the third quarter is $6.84 billion and full-year revenue is $26.21 billion (roughly in line with the company’s May 3 guidance for revenue growth of about 60% for the full year, or mid-30s growth on an organic basis).
Real Money tech columnist Eric Jhonsa will be live blogging AMD’s Q2 report, which is expected after Tuesday’s close, along with a earnings call scheduled for 5:00 p.m. ET.
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4:34 p.m. ET: AMD’s Q2 segment numbers. All four segments were solidly profitable in the second quarter. Embedded (mainly Xilinx) has the highest Op. Margin followed by Data Center (driven by Epyc CPU sales). Gaming has the lowest Op. Edge.
4:30 p.m. ET: Nvidia shares are down 1.4% AH following AMD’s report. Intel, which broke post-earnings last week on disappointing earnings/guidance, is up 0.3%.
4:28 p.m. ET: AMD spent $920 million on buybacks in the second quarter. This compares to $1.9 billion worth of buybacks in the first quarter.
Repurchase expenses nearly matched second quarter free cash flow of $906 million. AMD ended the second quarter with $6 billion in cash and $2.8 billion in debt.
4:24 p.m. ET: AMD’s Q2 Slide Deck is here. Here is the company’s formal guidance.
4:20 p.m. ET: Shares are now down 3% AH. Q3 guidance appears to be weighing on shares, but many investors are likely happy to see the full-year guidance reiterated. The conference call commentary on the puts and takes behind AMD’s sales forecasts (weakening PC demand is likely a headwind) will be closely monitored.
4:17 p.m. ET: Overall, revenue increased 70% Y/Y due to both organic growth and Xilinx. Q3 guidance ($6.7B, +/- $200M) implies ~55% revenue growth.
Separately, AMD previously said its guidance for full-year growth of around 60% (repeated only) implies organic revenue growth from the mid-30s.
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4:15 p.m. ET: Q2 revenue by segment:
Data center +83% y/y to $1.5bn
Customer +25% to $2.2 billion
Gaming +32% to $1.7 billion
Embedded +2228% (due to Xilinx deal) to $1.3B
Data center revenue includes some contributions from Xilinx and Pensando. But the lion’s share of revenue comes from AMD’s server CPUs and GPUs.
4:10 p.m. ET: Second quarter non-GAAP gross margin was 54%, up 640 basis points year over year and in line with guidance. AMD also expects ~54% GM in Q3 and reiterates guidance for ~54% GM for the full year.
4:08 p.m. ET: AMD is expecting Q3 revenue of $6.7 billion, below consensus of $6.84 billion. However, it reiterates full-year revenue growth guidance of ~60%.
Shares are down 4.8% in after-hours trading.
4:06 p.m. ET: results are there. Second quarter revenue of $6.55 billion is slightly above consensus of $6.53 billion. Likewise, non-GAAP EPS of $1.05 is slightly above a consensus of $1.03.
4:05 p.m. ET: With the markets nervous about demand for PCs and graphics cards, any comment on demand trends for the PC CPU and gaming GPU business will receive significant attention.
On the other hand, all indications are that server CPU demand from cloud giants (the proverbial hyperscalers) remains healthy. And AMD has indicated that SoC orders for gaming consoles will remain strong through 2023.
4:00 p.m. ET: AMD closed down 2.6%. The Q2 report should be out soon.
3:57 p.m. ET: The Q2 report will be the first to include AMD’s new reporting structure (after the Xilinx acquisition). Distribution is now divided into 4 segments: Data Center, Client, Gaming and Embedded.
3:55 p.m. ET: AMD shares are entering gains down 31% year-to-date amid broader selling pressures in tech stocks. But they have rallied somewhat in recent weeks, up 2.8% today to $99.47 before gains.
3:51 p.m. ET: AMD tends to report just after the market close. The Q1 report was released at 4:10pm ET.
3:49 p.m. ET: FactSet consensus calls for AMD to report second-quarter revenue of $6.53 billion and non-GAAP EPS of $1.03.
AMD’s revenue guidance for the third quarter and full year will receive particular attention. Third-quarter revenue consensus is $6.84 billion, and the company in May forecast ~60% full-year revenue growth. That outlook was reinforced at AMD’s analyst day in June.
3:46 p.m. ET: Hello, this is Eric Jhonsa. I’ll be live blogging and calling AMD’s earnings report.