After the US stock market closed on Tuesday, chip giant AMD (Chaowei Semiconductor) released its fourth quarter performance report, with slightly higher than expected revenue but lower than expected performance guidance for the first quarter of this year, resulting in the company's stock price falling nearly 6% in post market trading.
However, the company expects the new artificial intelligence (AI) processors to generate more revenue than expected this year.
The financial report shows that AMD's fourth quarter revenue was $6.17 billion, slightly higher than analysts' expectations of $6.13 billion; Earnings per share was 77 cents, in line with expectations; Adjusted operating profit margin of 23%, analyst expectation of 23.2%; After adjusting for the fourth quarter, the operating income was 1.41 billion US dollars, and analysts expected it to be 1.43 billion US dollars.
Among them, AMD's personal computer chip division had a revenue of $1.46 billion, lower than the expected $1.51 billion. The sales of data centers (including AI server chips) increased by 38% year-on-year, reaching $2.28 billion, with analysts expecting $2.3 billion. The revenue related to gaming computers was $1.37 billion, and analysts had previously estimated the department's sales to be $1.25 billion.
However, the biggest issue with this financial report is the performance guidance. The company expects revenue to be between $5.1 billion and $5.7 billion in the first quarter, lower than analysts' expectations of $5.77 billion; The adjusted gross profit margin is approximately 52%, which is similar to the analyst's expected 51.8%. In addition, the company expects its data center business to remain unchanged from the previous quarter.
AMD Chairman and CEO Su Zifeng stated in a conference call that the company expects sales of artificial intelligence chips (MI300) to reach $3.5 billion in 2024, higher than the previously predicted $2 billion. But according to Chris Caso, an analyst at research firm Wolfe Research, Wall Street has been expecting this number to reach as high as $8 billion.
"This forecast is lower than our expectations, but progress in data centers (and more importantly, artificial intelligence accelerators) has exceeded our previous estimates," said Matt Bryson, an analyst at the US investment bank Wedbush
The company launched a series of artificial intelligence accelerators called MI300 last month. This type of chip helps companies develop artificial intelligence models through a large amount of data, and the demand is high. Su Zifeng also stated that the sales of artificial intelligence chips in the fourth quarter exceeded the expected $400 million, but did not provide specific numbers.
When looking for ways to bet on artificial intelligence calculations, AMD stocks have always been one of the favorite choices for investors. But the biggest question is whether AMD's MI300 processor can challenge Nvidia and its H100's dominance. It is estimated that Nvidia's revenue has doubled in the past fiscal year.
After last year's strong performance, AMD has risen by about 24% so far this year, while Nvidia's increase is about 30%.