AMD Shares Jump On Strong Q2 Financials Fueled By Ryzen CPU And Radeon GPU Sales
Things are looking better indeed for AMD, thanks to the success of its Ryzen processors and Radeon GPUs. This is great news for PC fans everywhere, since AMD is finally offering CPUs (like its Ryzen Threadripper) that enthusiasts and gamers are once excited about. Competition is a great thing and will spur growth in the entire industry. The company's earnings are in and AMD's Q2 actuals were stronger than expected, thanks to demand for its bread and butter products.
AMD reported non-GAAP earnings of two cents per share with revenue of $1.22 billion. That figure represents growth of 19% on the $1.03 billion reported in the same quarter last year. Despite the boost in growth compared to the same quarter last year, AMD still reported a net loss of $16 million or ($0.02) per share. The loss was expected to be even larger than that, with Wall Street having predicted AMD would post non-GAAP earnings per share breaking even and revenue of $1.15 billion.
Losses aside, AMD did have some important news for investors and tech enthusiasts alike that was delivered during the earnings call. The first bit of good news was that game developers have mostly completed optimizations for Ryzen processors that will improve 1080p gameplay for some popular titles on systems running the parts. AMD also asks that gamers who are having a hard time finding its Radeon video cards keep in mind that the cryptocurrency speculators who have snapped up the available supply of Radeon graphics cards won't be around forever.
The Computing and Graphics segment, where Ryzen and Radeon live, was responsible for most of the gains AMD posted over expectations. Revenue from that segment grew 59% year-over-year to $659 million. While the Computing and Graphics segment rose, the business units responsible for enterprise and game console chips slumped with a 5% decline to $563 million.
Despite posting a loss, AMD is looking forward to a stellar Q3 and is predicting 23% sequential revenue growth. AMD CEO Lisa Su said during the earnings call that AMD was still "in the early innings" with Ryzen. AMD expects to ship more Ryzen parts in the coming months and Ryzen mobile processors are expected to land in time for holiday shopping.
One interesting side note from the earnings call came from Su when the executive teased another "semi-custom" chip that will ramp in 2018. Su didn't say who the semi-custom chip was for and only noted that it was embedded and that AMD would wait until the customer is ready to discuss that project. AMD is also just now bringing in the first revenues for its EPYC server chip and the new Vega GPUs; this revenue will have an impact in the coming quarters. It's looking to be a good 2017 for AMD.