AMD Earnings Q4 2022

AMD President and CEO Lisa Su speaks at the AMD keynote address during the Consumer Electronics Show (CES) on January 4, 2023 in Las Vegas, Nevada.

Robin Beck | AFP | Getty Images

amd Reported fourth quarter earnings on Tuesday, beating Wall Street’s expectations for sales and profit but guiding analysts for a 10% year-over-year sales decline in the current quarter. The stock rose more than 3% in extended trading. Here’s how the company fared versus Refinitiv consensus estimates for the quarter ending in December:

  • EPS: $0.69, adjusted, versus the expected $0.67 per share
  • Revenue: $5.6 billion, versus the $5.5 billion expected

AMD said it expects sales of $5.3 billion in the current quarter, slightly below Refinitiv’s estimate of $5.47 billion. AMD’s estimates suggest a 10% drop in sales in the current quarter. AMD’s sales rose 44% in the December quarter.

AMD also said it expected its adjusted gross margin to be around 50%, a key metric for chip makers.

AMD reported earnings as many of its rival chipmakers have stumbled in recent weeks, citing low consumer demand for parts needed to build PCs and servers and low consumer demand for finished electronics. Intel, AMD’s primary competitor, reported a disastrous quarter Last week that included a weak 2023 outlook.

AMD attributed its beating to strong growth in its embedded and data center businesses, and said its subscriber revenue, or chips for PCs and laptops, and its gaming segment were down.

AMD’s data center segment grew 42% year-over-year to $1.7 billion. AMD said its embedded segment grew 1,868%, driven by sales from the Xilinx purchase.

While AMD said it saw slower sales for its PC chips and graphics processors, it said its data center segment grew 42% year-over-year, suggesting it took market share from Intel.

But its customer group, which includes sales from PC processors, was down 51% year-over-year because of the weak PC market, AMD said. It said its customers have too much inventory of chips, a theme other semiconductor companies have noted in recent weeks. The global PC market is in a protracted slump, on the assumption,

AMD CEO Lisa Su said in a statement that the PC environment was “vulnerable”.

“While the demand environment remains mixed, we are confident in our ability to capture market share in 2023 and deliver long-term growth based on our differentiated product portfolio,” Su said in a statement.

AMD’s gaming business, which includes graphics cards and chips for gaming consoles, was down 7% year-over-year. The decrease came from graphics cards and was offset by “semi-custom” revenue, which is how the company reports sales from chips for gaming systems like the PlayStation 5.

AMD expects PC chips and graphics processor segments to continue to decline in the current quarter, but data center and embedded sales to grow.

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