Shares of Advanced Micro Devices Inc. were headed for record highs in after-hours trading Tuesday, after the chip company reported second-quarter earnings that beat expectations and despite its full-year COVID-19 epidemic Enhanced forecast.
Compared to second-quarter net income of $ 157 million in the year-ago period, or 13 cents per share, $ 35 million, or 3 cents per share. After adjusting for stock-based compensation and other factors, the chip company reported earnings of 18 cents, compared to 8 cents a share in the year-ago period. Revenue increased to $ 1.93 billion from $ 1.53 billion in the year-ago quarter.
Analysts polled by FactSet estimated adjusted earnings of 16 cents on revenue of $ 1.85 billion.
AMD announced that it now expects 2020 revenue to grow by approximately 32% from 2019, which would be equivalent to annual sales of about $ 8.88 billion from previous guidance of $ 8.08 billion to $ 8.75 billion according to FactSet. FactSet reported that analysts expected 2020 revenue of $ 8.4 billion on average.
“We posted strong second quarter results, record notebook and server processor sales as Ryzen and Epyc revenues more than doubled from a year earlier,” said Lisa Su, AMD president and CEO. “Despite some macroeconomic uncertainty, we are increasing our full-year revenue outlook as we enter the next phase of our growth driven by the acceleration of our business across multiple markets.”
Patrick Moorehead, principal analyst at Moore Insights and Strategy, who thought AMD was getting conservative earlier in the year, thinks there is even more room to drive sales.
“I believe this new forecast is conservative, as I think Epic revenue will kick in even more,” Moorehead said.
Shares rose more than 10% after closing 2% down in the regular session at $ 67.61, and were ahead of AMD’s intraday record of $ 71.63 set at the end of last week. After leading the S&P 500 Index SPX,
In annual percentage gains in both 2018 and 2019, AMD stock has risen more than 47% by 2020 as the S&P slipped 0.4%.
AMD’s results follow last week’s surprise announcement that Intel Corp. INTC,
It was delayed to release its 7-nanometer chips until at least the end of 2022 due to manufacturing issues. AMD has already rolled out 7nm chips for servers and personal computers, and has gained huge market share and increased sales and profits with those products.
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AMD reported sales of $ 1.37 billion for computing and graphics chips, up 45% from $ 940 million last year, in line with analysts’ expectations of 1.36 billion with a 45% jump. Sales from enterprise embedded and semi-custom chips – the unit that includes data-center and gaming-console revenue – were $ 565 million, down 4% from $ 591 million a year earlier, but ahead of analysts’ average forecasts of 18% decline. . $ 485.5 million.
For the third quarter, AMD forecasted sales of $ 2.45 billion to $ 2.65 billion, while analysts forecast revenue of $ 2.31 billion on average. The company and analysts expect AMD’s embedded and semi-custom business to accelerate in the second half of the year as a new videogame console from Sony Corp SNE.
And Microsoft Corp. MSFT,
That is a feature of AMD chips.