AMD Reports Strong Q2 2024 Revenue, Driven by Data Center and Client Segments
In an exciting announcement, Advanced Micro Devices (AMD) has reported that its revenues for the second quarter reached $5.8 billion, a 9% increase from the previous year and surpassing analyst expectations. This growth was primarily fueled by record-breaking revenue in the data center segment, which reached $2.8 billion, marking a remarkable 115% surge compared to the same period last year. This success can be attributed to the steep ramp of AMD Instinct graphics processing unit (GPU) shipments and strong growth in 4th Gen Epyc sales.
Despite the overall positive results, the gaming segment revenue experienced a decline, reaching $648 million, a 59% drop from the previous year. This decrease was primarily caused by lower semi-custom revenue, as the console industry is in the fifth year of the game console cycle. However, it’s worth noting that AMD saw strong momentum in Instinct GPU shipments, and the client segment revenue reached $1.5 billion, a 49% increase from the previous year and a 9% growth compared to the prior quarter, driven by AMD Ryzen processor sales.
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Other Key Financial Highlights
AMD’s embedded segment revenue in Q2 2024 was $861 million, representing a 41% decrease from the previous year as inventory levels continued to normalize. The company’s gross profit margins were 53% on a non-GAAP basis, and net income reached $1.1 billion, reflecting a 19% increase from the previous year and an 11% growth from the previous quarter. Earnings per share also saw positive growth, reaching 69 cents on a non-GAAP basis, a 19% increase from the previous year and the prior quarter.
Guidance for Q3 2024
Looking ahead, AMD expects its revenue for Q3 2024 to reach $6.7 billion, with a possible variance of $300 million. This projection indicates a year-over-year growth of approximately 16% and a quarter-over-quarter growth of around 15%. The company also anticipates a non-GAAP gross margin of approximately 53.5%.
Leadership’s Perspective
AMD’s CEO, Lisa Su, expressed her satisfaction with the company’s performance, highlighting the strong revenue and earnings growth in the second quarter. She emphasized the accelerating AI business and the company’s position to achieve robust revenue growth in the second half of the year, driven by the demand for Instinct, EPYC, and Ryzen processors. Su also noted the significant growth opportunities arising from the rapid advances in generative AI, which are driving the need for enhanced computing power across various markets.
CFO Jean Hu echoed Su’s sentiments, praising AMD’s strong execution in the second quarter. Hu highlighted the revenue growth in the Data Center and Client segments, as well as the expansion of gross margin and solid earnings growth. Additionally, Hu emphasized the company’s strategic investments in AI, laying the foundation for future growth.
Exciting Product Announcements
At Computex 2024, AMD revealed its expanded AMD Instinct accelerator roadmap, which includes the upcoming AMD Instinct MI325X accelerator. This new accelerator, set to be available in Q4 2024, boasts superior memory capacity and compute performance. Furthermore, AMD announced the next-generation AMD CDNA 4 architecture, expected to launch in 2025, which promises up to a 35 times increase in AI inference performance compared to the AMD Instinct accelerators based on AMD CDNA 3.
The company also unveiled the AMD Ryzen AI 300 Series processors, its third-generation processor specifically designed for AI PCs. These processors offer an impressive 50 TOPs of AI processing power for Windows Copilot+ PCs. Several leading original equipment manufacturers (OEMs), including Acer, ASUS, HP, Lenovo, and MSI, showcased new devices powered by this lineup.
Lastly, AMD introduced the highly anticipated AMD Ryzen 9000 Series processors, based on the “Zen 5” architecture. These processors deliver exceptional performance in gaming, productivity, and content creation, further solidifying AMD’s position as a leader in the industry.