AMD Shares: Chipmaker Surpasses Q4 Targets

Chipmaker Advanced microdevices (AMD) Wall Street broke through Q4 barriers late Tuesday but set a lower bar for the current period. However, AMD’s shares rose in extended trading on strong sales of data center chips.




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The Santa Clara, California-based company earned an adjusted 69 cents per share on $5.6 billion in sales in the December quarter. Analysts polled by FactSet had expected AMD to post a profit of 67 cents per share on sales of $5.51 billion.

On an annualized basis, AMD’s profit fell 25%, while sales rose 16%. The acquisition of Xilinx boosted revenue and helped offset falling sales of PCs and gaming chips.

In the fourth quarter, AMD’s PC chip sales fell 51% year-on-year to $903 million amid weak demand for personal computers. Gaming segment revenue fell 7% to $1.6 billion.

Meanwhile, data center chip sales surged 42% to $1.7 billion, driven by Epyc server processors.

AMD shares rose after the report

AMD is forecasting $5.3 billion in sales for the current quarter, down 10% from last year. Analysts were expecting $5.5 billion in the first quarter.

Today, after the close of the stock market, AMD shares rose 2.7% to 77.20. During the regular session on Tuesday, AMD shares rose 3.7% to close at 75.15.

“While the demand environment is mixed, we are confident in our ability to increase market share in 2023 and deliver long-term growth based on our differentiated product portfolio,” CEO Lisa Su said in a press release.

According to IBD Stock Checkup, AMD shares are ranked 13th out of 34 shares in IBD’s semiconductor industry group. It has a so-so composite IBD rating of 70 out of 99. The composite rating assesses the stock’s key growth metrics relative to all other stocks, regardless of industry group.

Follow Patrick Seitz on Twitter: @IBD_PSeitz to learn more about consumer technology, software and semiconductor stocks.

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