Advanced Micro Devices report that its revenues for the second quarter were $5.8 billion, up 9% from a year ago and above analyst expectations.
The results were driven by record data center segment revenue, as the results were $2.8 billion, up 115% compared to a year ago. The quarter also saw growth driven by the steep ramp of AMD Instinct graphics processing unit (GPU) shipments and strong growth in 4th Gen Epyc sales. The weak spot in the quarter was game console chips, as the console cycle is in its fifth year.
Compared to the prior quarter, AMD also saw strong momentum in Instinct GPU shipments. Client segment revenue was $1.5 billion, up 49% from a year ago and 9% over the prior quarter driven by AMD Ryzen processor sales.
The gaming segment revenue, however, was weak at $648 million, with a drop of 59% from a year ago and a drop of 30% from the prior quarter primarily due to a lower semi-custom revenue as the console industry is in the fifth year of game console cycle.
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The embedded segment revenue was $861 million, down 41% from a year ago as customers continued to normalize inventory levels. Gross profit margins were 53% on a non-GAAP basis, and net income was $1.1 billion, up 19% from a year ago and 11% from the previous quarter. Earnings per share were 69 cents on a non-GAAP basis, up 19% from a year ago and 11% from the prior quarter.
For guidance, AMD said it expects Q3 24 revenue to be $6.7 billion, plus or minus $300 million. At the mid-point of the revenue range, this represents y/y growth of ~16% and q/q growth of ~15%. The non-GAAP gross margin is expected to be approximately 53.5%.
“We delivered strong revenue and earnings growth in the second quarter driven by record data center segment revenue,” said AMD Lisa Su, in a statement. “Our AI business continued accelerating and we are well positioned to deliver strong revenue growth in the second half of the year led by demand for Instinct, EPYC and Ryzen processors. The rapid advances in generative AI are driving demand for more compute in every market, creating significant growth opportunities as we deliver leadership AI solutions across our business.”
“AMD executed well in the second quarter, with revenue above the midpoint of our guidance driven by strong growth in the Data Center and Client segments,” said AMD CFO Jean Hu, in a statement. “In addition, we expanded gross margin and delivered solid earnings growth, while increasing our strategic AI investments to build the foundation for future growth.”
At Computex 2024, AMD unveiled an expanded AMD Instinct accelerator roadmap. The roadmap includes the new AMD Instinct MI325X accelerator, planned to be available in Q4 2024, with leadership memory capacity and compute performance. The next generation AMD CDNA 4 architecture, planned for 2025, is expected to bring up to a 35 times increase in AI inference performance compared to AMD Instinct accelerators based on AMD CDNA 3.
AMD announced the AMD Ryzen AI 300 Series processors, the company’s third generation processor for AI PCs, with industry-leading 50 TOPs of AI processing power for Windows Copilot+ PCs. OEMs including Acer, ASUS, HP, Lenovo and MSI unveiled new devices powered by the lineup.
AMD announced the new AMD Ryzen 9000 Series processors based on the “Zen 5” architecture, delivering leadership performance in gaming, productivity and content creation.
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