AMD reported on its success in the second quarter of 2022 – yes, it was about success, because, as expected, Lisa Su’s team showed excellent results and exceeded analysts’ expectations. And these successes contrast particularly sharply against the backdrop of disappointing results from Intel, which ended the quarter with a $454 million net loss.
In April-June, AMD’s revenue was $6.55 billion, up 70% from the same quarter in 2021 ($3.85 billion). AMD’s revenue has grown steadily for the eighth consecutive quarter. At the same time, GAAP-based gross margin fell 140 percentage points to 46%. The result of the quarter was a net profit of $447 million, 37% less than last year ($710 million). This was primarily due to lower operating income due to amortization of intangible assets associated with the acquisition of Xilinx. The non-GAAP calculation shows an increase in operating and net income to $1.982 billion and $1.707 billion, respectively.
Also in this report, AMD for the first time indicated data on income from the gaming business – for 2021 this direction brought $5.6 billion in revenue and almost $1 billion in operating profit against $138 million in net loss a year earlier. AMD’s gaming business includes custom chips for the Sony PS4|PS4 consoles and current Microsoft Xbox models, as well as discrete Radeon GPUs used in PC gaming graphics cards and high-end gaming laptops. Prior to this, AMD combined gaming video card and custom processor revenue, and console chip sales were included in the Enterprise, Embedded and Semi-Custom (Custom Chips, Enterprise and Embedded) division totals.
AMD’s gaming division is expected to continue to grow in revenue, especially if Sony, which started making money selling PS5 consoles since July 2021, will keep its word and ship a planned 18 million PS5 by the end of the year (now it seems unrealistic). Although Microsoft does not make money on the Xbox ( it sells consoles at a loss, cheaper than the cost price), however, AMD itself makes quite good money on chips for them.
Taking a closer look at AMD’s other key business areas, consumer processors and chipsets remain the top-grossing business, generating $2.15 billion last quarter, up 25% from the previous quarter. The gaming business is now the second largest in terms of income.
The server division, where AMD includes central processing units, professional graphics accelerators and other specialized products, provided $ 1.49 billion in revenue – an 83% increase on last year’s result. Embedded solutions, which take into account sales of AMD products and solutions from the recently acquired Xilinx, provided revenue of $ 1.26 billion – 2228% more than a year ago (mainly due to the same Xilinx).
In the third quarter of fiscal 2022, AMD expects revenue of $6.7 billion ± $200 million, corresponding to 55% year-on-year growth. At the same time, AMD increased its revenue forecast for all of 2022 from $21.5 billion to $26.3 billion.
Before the end of the year, AMD plans to release new gaming GPUs based on the RDNA 3 architecture and chiplet design, which will be manufactured using the 5 nm process technology. They will form the basis of future video cards of the Radeon RX 7000 series, which will compete with the GeForce RTX 4000. Previously, AMD has already managed to test the approach with multi-chip GPUs in accelerators for data centers of the Instinct MI200 line . AMD expects the new graphics cards to revitalize consumer demand in a market that is rapidly falling along with the PC market . As for graphics cards, power consumption is expected to increase by 600-700 watts by 2025 , and the next generation, if we talk about top models, are predicted to be 400 watts.
AMD also confirmed the unchanged release plans for the AM5 platform and 5nm Ryzen 7000 (Raphael / Zen 4) processors , with which Lisa Su’s team will fully respond to the mainstream Intel LGA1700 platform and 13th generation Core processors (Alder Lake-S). Their release should take place before the end of the third quarter. At the same time, the WCCFTech website found out the exact release schedule for the Ryzen 7000. The official presentation of the AMD Ryzen 7000 is August 30 at 03:00 Kyiv time. The AMD Ryzen 7000 review ban will end on September 13 at 4:00 pm, and the sale of new products will start on September 15 at 4:00 pm.
A few days earlier, AMD again overtook Intel in terms of market capitalization and continues to hold the lead.
AMD again costs more than Intel – the day before, the manufacturer of Core processors recorded a rapid decline in revenue
