© REUTERS AMD offers better-than-expected sales guidance on ‘accelerating’ demand for high-end chips
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(Updated – January 31, 2024 5:32 AM EST)
Advanced Micro Devices, Inc. (NASDAQ:AMD) reported better-than-expected financial results for its fourth quarter.
The chipmaker posted an earnings per share (EPS) of $0.77, exactly matching the analyst estimates. In terms of revenue, AMD reported a strong quarter with $6.2 billion in revenue, surpassing the consensus estimate of $6.13 billion.
The stock was down 6.6% in pre-market Wednesday trade.
Looking ahead, AMD expects its revenue to be between $5.1 billion and $5.7 billion. This forecast fell below the consensus estimate of $5.73 billion.
“We finished 2023 strong, with sequential and year-over-year revenue and earnings growth driven by record quarterly AMD Instinct GPU and EPYC CPU sales and higher AMD Ryzen processor sales,” said AMD Chair and CEO Dr. Lisa Su.
“Demand for our high-performance data center product portfolio continues to accelerate, positioning us well to deliver strong annual growth in what is an incredibly exciting time as AI re-shapes virtually every part of the computing market.”
Data Center segment revenue was $2.3 billion, up 38% year-over-year and 43% sequentially “driven by strong growth in AMD Instinct GPUs and 4th Gen AMD EPYC CPUs.”
Analysts at Wells Fargo lifted the price target by $25 to $190 per share and urged clients to buy the stock on weakness.
“Remain positive on AMD’s 2024-2025+ MI300X ramp (now model 2025 at $7.1B vs. prior $3.3B) + positioning for trad’l server CPU recovery,” the analysts commented in a post-earnings note.
Similarly, analysts at Roth MKM also lifted the price target to $190 as the company’s Data Ceter GPU guidance reflects demand.
“We believe AMD’s core data center momentum can continue to drive strength in shares with the company raising its CY24 AMD GPU guidance significantly, reflecting accelerating customer adoption.”
Source: Investing.com
