AMD revenue jumps 70% to $6.5 bn powered by data center business

Advanced Micro Devices (AMD) said its second-quarter revenue has jumped 70 percent to $6.55 billion powered by data center business.
AMD revenue Q2 2022
AMD has generated second quarter revenue of $1.5 billion (+83 percent) from data center business, driven by strong sales of EPYC server processors. AMD’s Data Center segment includes server CPUs, data center GPUs, Pensando and Xilinx data center products.

AMD has generated second quarter revenue of $2.2 billion (+25 percent) from Client business, driven by Ryzen mobile processor sales. Client processor ASP increased year-over-year driven by a richer mix of Ryzen mobile processor sales. AMD’s Client segment includes desktop and notebook PC processors and chipsets.

AMD has generated second quarter revenue of $1.7 billion (+32 percent) from gaming business, driven by higher semi-custom product sales, partially offset by a decline in gaming graphics revenue. AMD’s Gaming segment includes discrete graphics processors and semi-custom game console products.

AMD has generated second quarter revenue of $1.3 billion (+2228 percent) from embedded business, driven by the inclusion of Xilinx embedded revenue. AMD’s Embedded business revenue includes AMD and Xilinx embedded products.

Santa Clara, California-based AMD showed strong growth in the data center business, at the expense of its rival Intel. AMD cut its market forecast for personal computer sales.

“After the challenging quarter that Intel had, a lot of eyes were closely watching to see what AMD did and, overall, the numbers were solid,” said Bob O’Donnell, chief analyst at TECHnalysis Research. “The issue is the market was looking for a better forecast, but it’s clear that the company sees a challenging market going forward.”
AMD chipset businessInflation and the reopening of offices and schools have led people to spend less on personal computers (PCs) than they did during lockdowns, hurting companies like AMD, which is among the largest suppliers of central processing units and graphics processing units chipsets.

Chipmakers also under pressure from a spate of COVID curbs in China, an important PC market, and the Ukraine war, which have worsened supply-chain snarls and dragged demand further. Global shipments of PCs are expected to drop 9.5 percent this year, according to IT research firm Gartner.

Analysts had worried that Intel’s sales from Datacenter and AI Group (DCAI) falling 16 percent last quarter could also spell out a slowdown in the cloud business which has been booming

AMD CEO Lisa Su told analysts on earnings calls that in her interactions with customers, the cloud business continued to be strong. “We’re continuing to ramp new cloud instances … we see that continuing into the second half of the year.”

Su said AMD continued to gain market share in the data center business.

YipitData research director Nathaniel Harmon said AMD has been gaining market share in the data center and cloud market at Intel’s expense, while Intel has been losing 1-2 percentage points of share each quarter since the first quarter of 2019.

AMD is coping with a slowing PC market. Su told analysts that AMD revised its outlook on the PC market for this year to drop by the mid-teens percent from previous projections of a high single digit percent drop. Su said AMD was focusing on the higher end PC market.

The company expects revenue of $6.7 billion, plus or minus $200 million, for the current quarter..

AMD expanded its full-year forecast to a range of $26 billion to $26.6 billion, compared to about $26.3 billion earlier.