Lisa Su, president and CEO of AMD, during an interview with Mad Money, broadcasting from CNBC’s San Francisco bureau on November 21, 2019.
Jacob Jimenez | CNBC
AMD shares fell as much as 4% after the company reported fiscal fourth-quarter earnings that slightly beat analysts’ estimates on Tuesday, but offered a light revenue forecast for the current quarter.
Here’s how the company did:
- Earnings: Excluding certain items, 32 cents per share, vs. 31 cents per share as expected by analysts, according to Refinitiv.
- Revenue: $2.13 billion, vs. $2.11 billion as expected by analysts, according to Refinitiv.
AMD’s revenue grew 50% on an annualized basis in the quarter that ended on December 28, according to a statement. Revenue growth for the 2019 fiscal year, at $6.73 billion, was up 4%.
Revenue from AMD’s Computing and Graphics segment, including graphics cards and PC chips, totaled $1.66 billion, up almost 69% year over year and over the $1.50 billion consensus among analysts surveyed by FactSet.
The Enterprise, Embedded and Semi-Custom segment, including chips for servers and customized chips, contributed $465 million in revenue, up 7% and below than the FactSet consensus estimate of $604 million.
In the quarter AMD released new Ryzen PC chips featuring tiny 7-nanometer transistors and Radeon gaming graphics cards. Also in the quarter Microsoft unveiled a 15-inch Surface Laptop 3 featuring a custom AMD chip.
Mizuho analysts Vijay Rakesh and Jason Getz raised their rating on AMD stock to buy from neutral on January 8. They said they think in 2020 and 2021 capital expenditures will pick up at companies that run large data centers in the U.S. and China, which could help AMD and to some extent Intel, which leads the server chip market. They believe AMD could take share from Intel in the second half of 2020.
With respect to guidance, AMD is calling for quarterly revenue of $1.8 billion, plus or minus $50 million, implying roughly 42% annualized growth, and a gross margin of 46%, excluding certain items. In giving the guidance AMD pointed to growth from its Ryzen, Epyc and Radeon product lines. The revenue forecast was below the $1.86 billion Refinitiv revenue consensus.
For the 2020 fiscal year AMD sees 28% to 30% revenue growth and a 45% gross margin, excluding certain items. Analysts polled by Refinitiv had expected $8.59 billion in full-year revenue, which implies about 24% growth.
AMD shares are up 10% since the start of 2020.
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