Advanced Micro Devices Inc. shares declined in the extended session Tuesday after the chip maker topped Wall Street estimates for the quarter, but its outlook was lower than most analysts had forecast.
AMD (AMD) shares declined 3% after hours, following a 0.3% rise to close the regular session at $89.91, less than 0.1% above what they were 12 months ago.
AMD reported a first-quarter loss of $139 million, or 9 cents a share, versus net income of $786 million, or 56 cents a share, in the year-ago period. Adjusted earnings, which exclude stock-based compensation expenses and other items, were 60 cents a share, compared with $1.13 a share in the year-ago period. Gross margins came in at 50%, down from last year’s 53%.
Revenue fell to $5.35 billion from $5.89 billion in the year-ago quarter, with more than half of that coming from data-center and embedded sales.
Analysts surveyed by FactSet had forecast 56 cents a share on revenue of $5.31 billion. AMD had forecast revenue of $5 billion to $5.6 billion for the first quarter, with declines in client and gaming offset by gains in data-center and embedded sales, and a gross margin of 50%.
Data-center sales barely rose to $1.3 billion from 1.29 billion in the year ago period, while analysts expected $1.5 billion, the company reported, using its reclassified product groups.
Client — that is, PC — sales fell to $739 million from $2.12 billion a year ago, while the Street had estimated $859.4 million. Gaming sales declined to $1.8 billion from $1.89 billion in the year ago period, while analysts were expecting $1.5 billion. Embedded sales rose to $1.56 billion from $595 million a year ago, while the Street had forecast $1.43 billion.
AMD forecast second-quarter revenue of $5 billion to $5.6 billion, while analysts had estimated $5.5 billion.
Last quarter, AMD said it would keep taking data-center share away from Intel Corp. (INTC), which last week reported its largest quarterly loss ever. Intel, however, saw its shares rise because PC and data-center sales, while on the decline, had come in better than expected The chip maker also lowered expectations on its forecast.
AMD’s shares are up 39% year to date, while the PHLX Semiconductor Index is up 19%, the S&P 500 index has gained 7%, and the tech-heavy Nasdaq Composite Index has risen 16%. Like Nvidia Corp. (NVDA), AMD has been swept up in the hype of artificial-intelligence technology going mainstream amid the popularity of Microsoft Corp. (MSFT)-backed OpenAI’s ChatGPT generative AI.
Late Monday, auto chip supplier NXP Semiconductor NV(NXPI) topped Wall Street expectations, and shares rallied Tuesday, while last week, another big supplier to the auto market, Texas Instruments Inc. (TXN) said that sales to the auto industry remained strong.