AMD earnings Q3 2021

Lisa Su, president and chief government officer of Superior Micro Devices Inc. (AMD), offers the AMD Ryzen 4000 series chip during an AMD press event at CES 2020 in Las Vegas, Nevada, U.S., on Monday, Jan. 6, 2020.

Bridget Bennett | Bloomberg | Getty Visuals

AMD noted third-quarter earnings following the bell on Tuesday, with earnings and income beating analyst expectations, and a potent forecast for the fourth quarter.

The stock was up as considerably as 1% in extended trading.

Here’s how the chipmaker did against Refinitiv consensus estimates for the quarter ending Oct. 2:

  • EPS: $.73, altered, versus $.67 expected, up 16% year-around-calendar year.
  • Income: $4.31 billion, as opposed to $4.12 billion anticipated, up 54% calendar year-around-yr

AMD said it envisioned $4.5 billion in revenue in the fourth quarter, ahead of analyst expectations of about $4.25 billion in gross sales in the quarter. AMD is forecasting 39% annual growth in the fourth quarter.

AMD is a single of the corporations that has benefitted the most from the surge in electronics product sales more than the past 18 months as its central processors and graphics processors energy PCs, servers and match consoles. These profits are logged in AMD’s computing and graphics phase, which documented $2.4 billion in profits, up 44% calendar year-around-12 months.

The Computer current market has slowed from its torrid rate a 12 months in the past when individuals all-around the entire world nonetheless required personal computers to operate or understand from home, but AMD claimed its chips were marketing at better normal selling prices as shoppers opt for much more potent processors.

AMD studies server chip and console chip revenue in its Embedded, Organization, and Semi-personalized section. AMD claimed $1.9 billion in revenue in this significant classification, up 69% year-around-yr driven by Epyc server chips, and better “semi-custom” profits, which are the semiconductors it sells to sport console makers.

AMD is in the procedure of taking market share in the server market place at the rear of its Epyc processors, as giants like Microsoft and Google acquire its chips to run their cloud services. AMD CEO Lisa Su explained in a statment that facts heart product sales doubled 12 months-around-12 months and now signifies “mid-20s” of all round AMD profits.

Meanwhile, video game consoles, like Sony’s Playstation 5 and new Microsoft Xbox types, continue being in substantial demand from customers and tough to uncover as they sell out quickly. Similarly, AMD’s graphics and central processors are hard to discover in stock in suppliers.

“Semi-tailor made revenue grew sequentially and calendar year-in excess of-year as demand for the most recent Microsoft and Sony consoles stays extremely powerful,” Su explained on a call with analysts on Tuesday. “We count on semi-custom income to improve sequentially in the fourth quarter as we further more ramp offer to address the ongoing sport console demand.”

AMD is a fabless chip organization. It patterns the technological know-how inside of its semiconductors and outsources producing to foundry partners like TSMC and GlobalFoundries. In September, AMD CEO Su stated she expects the chip scarcity to turn into considerably less severe in 2022.

AMD proceeds to keep its prices underneath regulate and enhance its profitability. It stated its gross margin was 48%, up from 44% in the similar interval very last year because consumers are shopping for far more high priced processors. It forecast gross margins at 49.5% in the fourth quarter. AMD’s web revenue for the quarter was $893 million.

Very last Oct, AMD introduced its programs to get Xilinix in a deal truly worth $35 billion that would give the company far more firepower to compete with Intel in the knowledge centre chip marketplace. AMD said the deal was nevertheless on track to close by the finish of 2021 and the corporation is producing “superior progress” to securing regulatory approvals.

AMD mentioned it repurchased $750 million in shares through the quarter. AMD inventory is up in excess of 30% yr to date.

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