SAN FRANCISCO: Advanced Micro Devices Inc. reported second-quarter earnings Tuesday that narrowly missed Wall Street expectations, sending shares down about 4% in after-hours trading.
The chipmaker posted adjusted earnings per share of 48 cents, just below the 49 cents forecast by LSEG. Revenue came in at $7.69 billion, beating the $7.42 billion estimate. For the current quarter, AMD projected sales of $8.7 billion, plus or minus $300 million, ahead of analysts’ expectations of $8.3 billion.
Net income rose to $872 million, or 54 cents per share, from $265 million, or 16 cents per share, a year earlier.
AMD, the second-largest maker of GPUs for artificial intelligence behind Nvidia, is gaining traction among major AI players such as Meta and OpenAI. The company unveiled its MI400 series of AI chips during the quarter, expected to launch next year. OpenAI CEO Sam Altman has committed to using AMD’s latest GPUs.
However, AMD continues to face headwinds from U.S. export controls. The MI308 chip, previously barred from export to China, cost the company $800 million in the June quarter. AMD said its current outlook excludes revenue from the MI308, with license applications under review by the Department of Commerce.
Adjusted gross margin stood at 43%, which AMD said would have reached 54% without export-related costs.
The company’s data center segment, which includes CPUs and GPUs, reported $3.2 billion in revenue, up 14% year-over-year. Its Client and Gaming segment surged 69% to $3.6 billion, driven by strong demand for Ryzen Zen 5 desktop CPUs and custom gaming chips. Gaming revenue alone jumped 73% to $1.1 billion, beating StreetAccount estimates.