by AMD inventory rose Wednesday after the chipmaker reported stronger-than-expected knowledge heart chip gross sales within the fourth quarter. But Advanced Micro Devices (AMD) tempered that information with comfortable steering for the present interval.
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The Santa Clara, Calif.-based firm late Tuesday stated it earned an adjusted 69 cents a share on gross sales of $5.6 billion within the December quarter. Analysts polled by FactSet had anticipated AMD earnings of 67 cents a share on gross sales of $5.51 billion.
On a year-over-year foundation, AMD earnings fell 25% whereas gross sales rose 16%. The acquisition of Xilinx boosted income and helped offset declining PC and gaming chip gross sales.
In the fourth quarter, AMD’s PC chip gross sales dropped 51% yr over yr to $903 million amid weak private laptop demand. Gaming phase income slid 7% to $1.6 billion.
Meanwhile, knowledge heart chip gross sales elevated 42% to $1.7 billion, pushed by Epyc server processors.
AMD Stock Rises After Report
For the present quarter, AMD predicted gross sales of $5.3 billion, down 10% yr over yr. Analysts have been searching for $5.5 billion within the first quarter.
In morning trades on the stock market today, AMD inventory jumped 7% to 80.42. During the common session Tuesday, AMD inventory climbed 3.7% to shut at 75.15.
“Although the demand atmosphere is combined, we’re assured in our capability to achieve market share in 2023 and ship long-term progress based mostly on our differentiated product portfolio,” Chief Executive Lisa Su stated in a news release.
Wall Street Divided On News
AMD’s fourth-quarter report supplied one thing for bulls in addition to bears. At least three Wall Street analysts raised their priced targets on AMD inventory whereas one other three lowered their targets.
AMD expects the PC market to backside within the first quarter. The firm additionally sees cloud computing prospects working to digest chip stock within the first half of the yr.
AMD hopes to counter the headwinds within the total market by taking share from rival Intel (INTC). But these efforts are prone to lower the corporate’s revenue margins, analysts say.
AMD inventory ranks No. 12 out of 34 shares in IBD’s fabless semiconductor trade group, in line with IBD Stock Checkup. It has a so-so IBD Composite Rating of 72 out of 99. The Composite Rating scores a inventory’s key progress metrics towards all different shares no matter trade group.
Follow Patrick Seitz on Twitter at @IBD_PSeitz for extra tales on shopper know-how, software program and semiconductor shares.
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