AMD unveils Q1 2024 financial report, showcasing promising performance

AMD reports strong financial results for Q1 2024, with record revenue in the Data Center segment and significant growth in the Client segment, driven by increased shipments of AI accelerators and processors.

1. Strong financial performance with record revenue and gross margin expansion 2. Significant growth in Data Center and Client segments, driven by increased shipments of AI accelerator and adoption of Ryzen and EPYC processors 3. Expanding AI capabilities across product portfolio and partnerships with leading companies in various markets.

AMD, the semiconductor company, has reported its financial results for the first quarter of 2024. The company achieved revenue of $5.5 billion, gross margin of 47%, operating income of $36 million, net income of $123 million, and diluted earnings per share of $0.07. On a non-GAAP basis, AMD’s gross margin was 52%, operating income reached $1.1 billion, net income amounted to $1.0 billion, and diluted earnings per share stood at $0.62.

Dr. Lisa Su, the Chair and CEO of AMD, expressed her satisfaction with the strong performance in the first quarter. She highlighted the significant growth in the Data Center and Client segments, which both experienced over 80% year-over-year growth. This growth was primarily driven by the increased shipments of AMD’s MI300 AI accelerator and the adoption of Ryzen and EPYC processors.

The increasing demand for compute power across various markets due to the widespread deployment of AI is an exciting development for the industry. AMD is well-positioned to capitalize on this trend as it continues to strengthen its data center business and expand AI capabilities across its product portfolio.

Jean Hu, AMD’s EVP, CFO, and Treasurer, commended the company’s record quarterly revenue in the Data Center segment. Hu also emphasized the solid gross margin expansion achieved by AMD. Looking ahead, AMD is confident in its ability to drive revenue growth and improve margins while investing in the promising AI opportunities that lie ahead.

In terms of segment performance, AMD’s Data Center segment revenue reached a record $2.3 billion, representing an impressive 80% year-over-year growth. This growth was driven by strong sales of both AMD Instinct GPUs and 4th Gen AMD EPYC CPUs. Sequentially, revenue increased by 2% due to the first full quarter of AMD Instinct GPU sales, partially offset by a seasonal decline in server CPU sales.

The Client segment revenue amounted to $1.4 billion, experiencing an 85% year-over-year growth primarily fueled by sales of AMD Ryzen 8000 Series processors. However, the segment’s revenue declined by 6% sequentially.

The Gaming segment revenue stood at $922 million, showing a significant decline of 48% year-over-year and 33% sequentially. This decrease was attributed to lower semi-custom revenue and decreased sales of AMD Radeon GPUs.

The Embedded segment revenue reached $846 million, experiencing a decline of 46% year-over-year and 20% sequentially. This decline was primarily due to customers managing their inventory levels.

AMD has been making notable progress in the AI space. The company expanded its AI solutions for various markets, including cloud, enterprise, embedded, and PC. Lenovo, Dell Technologies, and Supermicro have all showcased systems featuring AMD’s Instinct MI300X AI accelerator. The AMD AI software ecosystem has also seen improvements, with optimizations and additional features in the latest AMD ROCm 6.1 software stack.

Additionally, AMD has expanded its commercial AI PC processor portfolio with the launch of new AMD Ryzen PRO processors, which offer superior AI and compute performance along with advanced security features. HP and Lenovo have already announced new enterprise PCs powered by these processors.

AMD’s commitment to advancing AI innovation was evident at the “Advancing AI PC Innovation Summit,” where numerous partners showcased over 100 AI experiences available through AMD platforms. The company expects more than 150 independent software vendors (ISVs) to develop for Ryzen AI by the end of the year.

In other developments, AMD launched new Versal Series Gen 2 devices, including the Versal AI Edge Series Gen 2 SoCs, which enable efficient end-to-end acceleration of AI-driven embedded systems. Subaru plans to utilize these devices in their next-gen EyeSight ADAS vision system. AMD’s Embedded+ architecture, which combines x86 embedded processors with adaptive SoCs, aims to accelerate the time to market for edge AI applications.

AMD has also seen success in its partnerships with leading companies. Lenovo announced two new platforms powered by 4th Gen AMD EPYC processors, catering to AI-optimized solutions and mixed enterprise workloads. Samsung, Vodafone, Ericsson, and Telstra have all embraced AMD EPYC processors for various applications, including virtualized RAN solutions and energy-efficient 5G core functions.

Furthermore, AMD remains focused on enhancing its software products for gamers. The company introduced AMD FidelityFX Super Resolution 3.1, which brings significant image quality improvements and expanded developer support. AMD Fluid Motion Frames has also been introduced to increase frame generation for thousands of games.

Looking ahead to the second quarter of 2024, AMD expects revenue to be approximately $5.7 billion, with a growth rate of around 6% year-over-year and 4% sequentially. The non-GAAP gross margin is projected to be around 53%.

AMD’s financial results reflect the company’s strong performance and its ability to capitalize on the growing demand for AI-driven computing solutions. With a robust product portfolio and strategic partnerships, AMD is well-positioned to continue its growth trajectory and further establish itself as a key player in the tech industry.

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Background Information

About AMD: AMD, a large player in the semiconductor industry is known for its powerful processors and graphic solutions, AMD has consistently pushed the boundaries of performance, efficiency, and user experience. With a customer-centric approach, the company has cultivated a reputation for delivering high-performance solutions that cater to the needs of gamers, professionals, and general users. AMD's Ryzen series of processors have redefined the landscape of desktop and laptop computing, offering impressive multi-core performance and competitive pricing that has challenged the dominance of its competitors. Complementing its processor expertise, AMD's Radeon graphics cards have also earned accolades for their efficiency and exceptional graphical capabilities, making them a favored choice among gamers and content creators. The company's commitment to innovation and technology continues to shape the client computing landscape, providing users with powerful tools to fuel their digital endeavors.

About Dell: Dell is a globally technology leader providing comprehensive solutions in the field of hardware, software, and services. for its customizable computers and enterprise solutions, Dell offers a diverse range of laptops, desktops, servers, and networking equipment. With a commitment to innovation and customer satisfaction, Dell caters to a wide range of consumer and business needs, making it a important player in the tech industry.

About HP: Founded by Bill Hewlett and Dave Packard in a garage in 1939, HP (Hewlett-Packard) is a global technology giant known for its pioneering innovations in computing and printing technology. With a legacy of over eight decades, HP has consistently delivered a wide range of high-quality products and services, including personal computers, printers, servers, and software solutions.

About Lenovo: Lenovo, formerly known as "Legend Holdings," is a important global technology company that offers an extensive portfolio of computers, smartphones, servers, and electronic devices. Notably, Lenovo acquired IBM's personal computer division, including the ThinkPad line of laptops, in 2005. With a strong presence in laptops and PCs, Lenovo's products cater to a wide range of consumer and business needs. Committed to innovation and quality, Lenovo delivers reliable and high-performance solutions, making it a significant player in the tech industry.

About Samsung: Samsung, a South Korean multinational conglomerate, has established itself as a global leader in various industries, including electronics, technology, and more. Founded in 1938, Samsung's influence spans from smartphones and consumer electronics to semiconductors and home appliances. With a commitment to innovation, Samsung has contributed products like the Galaxy series of smartphones, QLED TVs, and SSDs that have revolutionized the way we live and work.

About Supermicro: Supermicro is a reputable American technology company founded in 1993 and headquartered in San Jose, California. Specializing in high-performance server and storage solutions, Supermicro has become a trusted name in the data center industry. The company offers a wide range of innovative and customizable server hardware, including motherboards, servers, storage systems, and networking equipment, catering to the needs of enterprise clients, cloud service providers, and businesses seeking reliable infrastructure solutions.

Technology Explained

CPU: The Central Processing Unit (CPU) is the brain of a computer, responsible for executing instructions and performing calculations. It is the most important component of a computer system, as it is responsible for controlling all other components. CPUs are used in a wide range of applications, from desktop computers to mobile devices, gaming consoles, and even supercomputers. CPUs are used to process data, execute instructions, and control the flow of information within a computer system. They are also used to control the input and output of data, as well as to store and retrieve data from memory. CPUs are essential for the functioning of any computer system, and their applications in the computer industry are vast.

EPYC: EPYC is a technology designed by computer chip manufacturer AMD for use in the server and data center industry. It was introduced in June 2017 and features an innovative design to improve performance and power efficiency. EPYC processor technology is based on an innovative 14nm processor architecture, allowing up to 32 high-performance cores in a single socket. This allows for more efficient processing power, increased memory bandwidth, and greater compute density. EPYC is now widely used in the data center and cloud computing industry and provides benefits such as greater scalability, increased resource efficiency, and advanced virtualization capabilities. Additionally, EPYC technology is used in data intensive servers like server farms, gaming, and virtualization platforms. EPYC ensures that even with large deployments in multi-processor environments, power consumption and performance levels are optimized to ensure maximum efficiency.

GPU: GPU stands for Graphics Processing Unit and is a specialized type of processor designed to handle graphics-intensive tasks. It is used in the computer industry to render images, videos, and 3D graphics. GPUs are used in gaming consoles, PCs, and mobile devices to provide a smooth and immersive gaming experience. They are also used in the medical field to create 3D models of organs and tissues, and in the automotive industry to create virtual prototypes of cars. GPUs are also used in the field of artificial intelligence to process large amounts of data and create complex models. GPUs are becoming increasingly important in the computer industry as they are able to process large amounts of data quickly and efficiently.

Radeon: AMD Radeon, a product line by Advanced Micro Devices (AMD), consists of graphics processing units (GPUs) recognized for their strong performance in gaming, content creation, and professional applications. Powered by innovative technologies like the RDNA architecture, Radeon GPUs deliver efficient and powerful graphics processing. The brand also supports features like FreeSync, enhancing visual fluidity and reducing screen tearing during gaming. Moreover, AMD Radeon GPUs embrace real-time ray tracing for heightened realism in lighting and reflections. With a balance between price and performance, Radeon competes with NVIDIA's GeForce graphics cards and remains a popular choice for a wide range of users.