AMD announced its financial results for the third quarter of 2022 on Tuesday. In total, he hit $5.6 billion in revenue for the company as CPU and GPU sales for AMD’s client segment were sluggish. Meanwhile, AMD’s data center product sales set new records as demand for its EPYC CPUs, Pensando DPUs and Xilinx Field Programmable Gate Array products remains strong.
Dr. Lisa Su, Head of AMD, said: “Despite a challenging macro environment, revenue increased 29% year-over-year driven by growth in data center, embedded and game console product sales. Our leadership product portfolio, strong balance sheet and continued growth opportunities. We are confident that our data center and embedded businesses are well suited to navigate current market dynamics.”
Strong Data Center and Gaming Earnings
AMD’s Q3 2022 revenue reached $5.565 billion, up 29% year-over-year but down $985 million from the previous quarter. The company’s gross margin declined to 42% from 48% in the same period last year. As for net income, he fell to $66 million from $923 million in the third quarter of 2022, but earnings per share fell to $0.04, down from $0.75 a year ago. . AMD highlighted lower profitability due to amortization of intangible assets and increased R&D investment related to the Xilinx acquisition, partially offset by his $135 million tax benefit in the quarter. I was.
Demand for client processors and chipsets dropped significantly in the third quarter. This is why AMD’s Client Computing revenue fell to $1.022 billion in Q3 2022, or 40% year-over-year. Additionally, the company’s client business unit suffered his $26 million loss during the quarter as the company’s client was trying to clear inventory. Therefore, AMD had to offer certain incentives for selling products in their inventory.
AMD’s gaming business (which includes client GPUs and console systems-on-a-chip) continued to show mixed results throughout the quarter. The business unit earned him $1.631 trillion in the third quarter, up 14% year over year. However, AMD’s Gaming BU did well not because demand for its Radeon RX 6000 series graphics processors was particularly strong, but rather because Microsoft and Sony geared up for the holiday season, launching their Xbox and PlayStation game consoles in Q3 2022. Because I bought a lot of System-on-Chip for .
AMD’s data center business unit is the company’s major success story in recent years. The third quarter was no exception. BU sales were $1.609 trillion, up 45% year over year. Operating income exceeded $505 billion, up 64% year-over-year. Most importantly, AMD started shipping its next-generation EPYC ‘Genoa’ processors to select customers in Q3, but those quantities mattered little. The company said its data center business unit was under supply constraints during the quarter, and that constraints will be eased in the fourth quarter of 2022, allowing it to capture more market share from arch-rival Intel. That’s what I mean.
AMD’s Embedded business, which sells a variety of AMD-developed products and Xilinx-designed solutions, saw a year-on-year increase of 1,549 in Q3 2021 as AMD’s Embedded BU sold only the company’s unpopular CPUs and GPUs. Earned $1.3 billion, up 10%. .
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cautious outlook
AMD is optimistic about its data center and embedded businesses in Q4, but expects less from Q4 2022. First, the fundamental weakness of the client PC market means the company can hardly sell client CPU loads. Meanwhile, sales of his SoCs for consoles decline sequentially. AMD’s discrete graphics processors typically ramp up GPUs very slowly, so sales increases are unlikely to offset them.
AMD expects fourth quarter 2022 revenue to be approximately $5.5 billion ± $300 million. AMD forecasts full-year 2022 revenue of approximately $23.5 billion ± $300 million. That’s a nearly 43% year-over-year increase, largely due to the success of his AMD’s data center and embedded offerings.
