AMD Promises Better Revenue with the Launch of MI300 Artificial-Intelligence chips

AMD, the leading semiconductor company, has announced its financial results for the second quarter of 2023. Despite challenges in the market, the company reported a revenue of $5.4 billion, representing an 18 percent decline. The gross margin stood at 46 percent, with an operating loss of $20 million and net income of $27 million.
AMD chipset businessLisa Su, AMD Chair, and CEO expressed satisfaction with the results, highlighting the significant ramp-up of 4th Gen EPYC and Ryzen 7000 processors. She mentioned that the company’s AI engagements increased significantly, with multiple customers initiating or expanding programs to support future deployments of Instinct accelerators at scale.

In the Data Center segment, AMD achieved revenue of $1.3 billion, showing an 11 percent decline primarily due to lower 3rd Gen EPYC processor sales as enterprise demand softened and cloud inventory levels remained elevated in some customers. However, the Data Center segment revenue increased 2 percent sequentially, driven by nearly doubled revenue from 4th Gen AMD EPYC CPUs and increased sales of EPYC CPUs to enterprises, partially offset by a decline in adaptive System-on-Chip (SoC) data center products.

AMD said the Client segment revenue reached $998 million, indicating a 54 percent year-over-year decline due to reduced processor shipments caused by a weaker PC market and significant inventory correction across the PC supply chain. However, there was a 35 percent sequential increase in revenue as AMD Ryzen 7000 Series CPU sales grew significantly, and PC market conditions improved.

AMD’s Gaming segment revenue reached $1.6 billion, down 4 percent year-over-year. Although Semi-custom revenue increased year-over-year, it was outweighed by lower gaming graphics revenue. The segment experienced a 10 percent sequential decline primarily due to lower gaming graphics sales.

On the positive side, the Embedded segment revenue showed significant growth, reaching $1.5 billion, an increase of 16 percent year-over-year, primarily driven by strength in the Industrial, Vision and Healthcare, Automotive, and Test and Emulation markets. However, revenue decreased 7 percent sequentially due to softness in the Communications market.

Lisa Su also provided insights into future product offerings, with AMD Instinct MI300A and MI300X GPUs being sampled to leading HPC, Cloud, and AI customers. Additionally, more than 100 AMD-powered commercial PC platforms are set to launch this year, further boosting the company’s prospects.

AMD forecasts a strong finish to the year, driven by the planned launch of artificial-intelligence chips that could compete with Nvidia semiconductors.

AMD aims to ramp up production of its flagship MI300 artificial-intelligence chips in the fourth quarter. The accelerator chips, which are in short supply, are designed to compete against the advanced H100 chips already sold by Nvidia.

For the third quarter of 2023, AMD expects revenue to be around $5.7 billion, with a gross margin of approximately 51 percent. The promising outlook reflects the company’s commitment to delivering innovative products and strengthening its position in the semiconductor market.