AMD boasts of Ryzen-backed growth, still makes a loss

July 26, 2017 | 10:57

Tags: #cpu #epyc #financial #lisa-su #processor #processors #ryzen #ryzen-threadripper #zen

Companies: #amd #intel

AMD has released its earnings for the second quarter of its 2017 financial year, and while its revenue is on the up it is still struggling to turn interest in its Zen architecture into profits.

According to AMD's latest financial reports, the company earned a whopping $1.22 billion in revenue for the second quarter, up from $984 million the quarter prior and $1.03 billion for the same quarter last year. Sadly, while the company posted an operating income of $25 million - its first positive operating income in some time - its net income, the figure that really matters, sat at a loss of $16 million. While that's considerably improved from the $73 million the company lost the quarter prior, it's money AMD can ill afford to be bleeding as it fights for survival against longstanding rival Intel.

'Our second quarter results demonstrate strong growth driven by leadership products and focused execution,' claimed Lisa Su, AMD's president and CEO, during the company's earnings call. 'Our Ryzen desktop processors, Vega GPUs, and Epyc data centre products have received tremendous industry recognition. We are very pleased with our improved financial performance, including double digit revenue growth and year-over-year gross margin expansion on the strength of our new products.'

While the launch of the first chips built around the company's Zen microarchitecture may not have been enough to put its balance sheet in the black, it's fair to say they've had a considerable impact on AMD's fortunes. The company has reported a 51 percent year-on-year growth of its computing and graphics business, hitting $659 million in revenue, which has more than balanced out a five percent year-on-year decline in its enterprise, embedded, and semi-custom business arm. Despite a boost to average selling prices, though, AMD continues to trade its parts on a slim margin of 33 percent - around half that enjoyed by rival Intel, giving the company room to considerably discount its products should AMD begin to win back major market share.

For the coming quarter, AMD is painting a rosy picture: The company claims it expects a 23 percent sequential growth in revenue, plus or minus three percent, for a 15 percent or higher annual growth. That's news investors have taken to the bank: AMD's share price has risen 9.07 percent in pre-market trading following a 0.35 percent dip prior to the announcement.

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