AMD CEO Talks Datacenter Share Gains As EPYC's 2X Uplift Per Socket Drives Revenue

AMD Lisa Su with EPYC Zen 2 64 Core CPU
AMD reported its Q4 earnings yesterday, and overall it was good news for the company. While revenue was lower than what analysts were expecting, the company met its mark for earnings, which drove shares higher after hours. AMD shares finished Tuesday with a nearly 20 percent gain.

A lot of that success rides on the back of AMD's Zen microarchitecture that underpins the company's Ryzen, Ryzen Threadripper and EPYC processor families. AMD CEO Lisa Su told CNBC's Jim Cramer that "innovation and product momentum" is the company's strategy, which is why it has gained market share from Intel 5 quarters in a row.

In fact, Su said that AMD had its strongest datacenter quarter ever during Q4, having more than doubled EPYC processor shipments compared to Q3. The company also witnessed growth with its datacenter GPUs. This comes at a time when Su says that rivals like Intel and NVIDIA have experienced what she and Cramer call "cloud indigestion" as customers attempt to figure out what to do in the hardware space. However, Su says that AMD’s strong roadmap along with a relatively "low base" with nowhere to go but up has somewhat insulated the company from outside forces (a la the Chinese economic slowdown).

While some analysts are stating that AMD is being a bit too aggressive with its full-year outlook, especially with regards to the second half of 2019, Su feels that macroeconomic pressure in China are merely a small speed bump and that the strength of its 7nm products -- both CPU and GPU -- will help carry the company forward. She sees 7nm as a big competitive advantage over NVIDIA in the GPU space and Intel in the CPU space (Intel's volume 10nm production won't kick off until Holiday 2019).

"It's a very complicated mousetrap... we made some big some big bets a few years ago. We bet on 7nm and we bet on a new innovation around how we put these chips together," said Su. "And our second-generation EPYC Jim; we're going to double the performance per socket. 

"And when you have that kind of inflection point in performance it has to translate into better results. And that's what we're focused on executing. So that's the play in servers."

amd epyc

And given what we've seen with 7nm EPYC Zen 2 "Rome" processors, there's no doubt that AMD is throwing a lot of performance into a single socket -- at least compared to the competition from Intel. In a recent C-Ray demonstration, AMD's 64-core/128-thread EPYC 1P prototype was seen putting the smackdown on a pair of 28-core/56-thread Xeon Platinum 8180M processors.

It remains to be seen if Su’s bullish outlook on 2019 will hold firm, but if AMD’s 7nm products are as good in shipping form as they are at the prototype stage, it very well could be a banner year for the company.


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