AMD reports impressive earnings with strong AI growth

AMD reports staggering datacenter growth with strong EPYC and Instinct sales

AMD have just released their Q2 2024 earnings, and they have reported strong growth for their AI and CPU segments. Gross margin (GAAP) is now up to 49%, and revenues are up 9% year over year. Even so, poor performance in some areas has some analysts worried. In Q2 2024, AMD generated $5.8 billion in revenue.

For Q2, AMD’s Data Center revenue has grown 115% year-over-year. This has driven AMD’s data center revenues to $2.8 billion. This is due to a “steep ramp” of AMD Instinct GPU sales. However, strong sales growth for AMD’s EPYC CPUs have also played a major role. Sequentially, AMD’s data center growth is 21% highlighting significant growth from Q1 2024.

AMD’s client revenues have increased by 49% year-over-year. This is due to growing sales for AMD’s Ryzen processors. Further growth is expected in Q3 thanks to the release of AMD’s new Zen 5 based Ryzen desktop and notebook GPUs.

Despite these huge gains, AMD’s total Q2 2024 revenue was only up 9% year over year. This is due to a 59% drop in revenue from their Gaming segment and a 41% drop in their Embedded revenue when compared to Q2 2023. These drops are primarily due to declining semi-custom sales (console sales), and lower embedded sales.

Moving onto Q3, AMD expects its earnings to continue to grow. Currently, AMD expects to generate revenues of approximately $6.7 billion. This would repesent year-on-year growth of 16% and sequential growth of 15%. This will be driven by continued growth in AI sales and the launch of AMD’s new Zen 5 based processors.

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