Advanced Micro Devices closed the first quarter accounts with results significantly better than analysts’ expectations, confirming the solidity of the business linked to the development of artificial intelligence and data centers. An indication which, together with the optimism clearly demonstrated by number one Lisa Su, inflamed the share prices on Wall Street, both during the regular session and especially after the US stock exchange.
Quarter numbers beyond the most optimistic expectations
The American chip giant announced revenues of 10.3 billion dollars, up 38% compared to the 7.4 billion of the previous year, greatly exceeding the consensus which indicated a turnover of 9.85 billion dollars. The Data Center segment remained the main growth driver, with revenues increasing 57% to $5.8 billion.
Operating profit rose to $1.5 billion, while net profit rose to $1.4 billion. GAAP diluted earnings per share rose 91% year-over-year to $0.84, while non-GAAP EPS rose 43% year-over-year to $1.37, exceeding analysts’ forecasts of $1.27.
Non-GAAP gross margin reached 55%, up 170 basis points from the prior year, driven by a stronger contribution from data center revenues.
AMD also generated record quarterly free cash flow of $2.6 billion, more than tripling from a year earlier, along with record operating cash flow of $3 billion.
The CEO optimistic about the future
“We had an exceptional first quarter, driven by growing demand for AI infrastructure, with Data Centers now the primary driver of our revenue and earnings growth,” said Lisa Su, President and CEO of AMD.
“Looking ahead,” she continues, “we expect growth in the server market to accelerate significantly as we expand offerings to meet demand. Customer engagement with the MI450 and Helios series is strengthening, with key customer forecasts exceeding our initial expectations and a growing pipeline of large-scale deployments providing us with greater visibility into our growth trajectory.”
Analysts’ “hot” opinions
David Pascucci, analyst at XTB speaks of an “excellent quarterly” which demonstrates that “lately there is a single denominator, that relating to hardware, to data centers”. above 100, a level which could in fact be very dangerous for the long-term stability of a trend which is also clearly bullish”.
Bernstein promoted AMD, raising his rating from Market Perform to Outperform and raising the target price to $525 from the $265 previously indicated, also due to the current valuation of the stock on the market.
AMD takes off on Wall Street
The positive surprise in the accounts galvanized AMD shares, which in the after-hours session of the American stock exchange achieved a rise of more than 16%, after closing the regular session up 4% at 355.26 dollars per share. A performance that is not divorced from the success of the last year, when AMD shares recorded a rise of 253%, while the change since the beginning of the year already shows a +66%.
