AMD said client segment revenue dropped 51% YoY to $903 million in 2022 Q4.
Semiconductor company AMD (NASDAQ: AMD) exceeded analysts’ expectations in 2022 Q4 with a strong performance in sales and profit. The company reported earnings as other chipmakers have been having a tough time. Many semiconductor companies declined over the past weeks due to a fall in customers’ demand for finished electronics. There is also lower demand for PCs and server parts. During the quarter, adjusted earnings per share came in at $0.69, popping above analysts’ prediction of $0.67 per share. Also, revenue was $5.6 billion versus the $5.5 billion expected.
AMD Announces Q4 2022 Results
Announcing its 2022 Q4 financial results, AMD attributed its revenue growth to “Embedded and Data Center segments.” The quarterly revenue jumped 16% compared to the same period in 2021. The data center segment increased 42% YoY to $17 billion, while the embedded segment surged 1,868%. The chipmaker added that the embedded grew due to its sales from its acquisition of Xilinx. At the same time, the company said gross margin went down 7% points YoY to 43%. It attributed the fall to the amortization of intangible assets associated with the purchase. On the other hand, the non-GAAP gross margin was 51%, increasing by 1% point YoY.
Additionally, AMD said client segment revenue dropped 51% YoY to $903 million in 2022 Q4. This is caused by a significant reduction in processor shipments that emanated from a weak PC market. The reduced revenue for the quarter also resulted in an operating loss of $152 million compared to an operating income of $530 million. While the PC market suffered a hit in 2022, shipments are expected to plunge further by 6.8% this year. Personal computer shipments fell 16% in 2022.
AMD Chair and CRO Dr. Lisa Su commented on the 2022 Q4 results, saying:
“2022 was a strong year for AMD as we delivered best-in-class growth and record revenue despite the weak PC environment in the second half of the year. We accelerated our data center momentum and closed our strategic acquisition of Xilinx, significantly diversifying our business and strengthening our financial model. Although the demand environment is mixed, we are confident in our ability to gain market share in 2023 and deliver long-term growth based on our differentiated product portfolio.”
In reaction to the Q4 2022 results, AMD rose 2% in after-hours trading but now trades at 1.41% to $76.21. After shedding nearly 39% over the past year, the chipmaker has been performing well since the year started. Since the beginning of 2023, AMD stock has gained 16.03%, and in addition, grew 18.18% in the last three months. The company’s stock has also increased 16.22% over the past month and 0.32% in the last five days.
Moving forward, AMD guided analysts to a 10% loss in revenue for the first quarter this year.
Ibukun is a crypto/finance writer interested in passing relevant information, using non-complex words to reach all kinds of audience.
Apart from writing, she likes to see movies, cook, and explore restaurants in the city of Lagos, where she resides.
