AMD Grows Data Center Revenue By 115% As AI Products Take Hold In Market
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Chip designer AMD beat analyst revenue and EPS estimates for its second quarter financials, sending the shares soaring in aftermarket trading. AMD reported $5.8 billion in revenue and $0.69 in earnings per share, which was higher than the $5.72 billion and $0.68 that analysts had penciled in for the quarter. At the heart of the beat was AMD's AI division, with AI sales helping it grow Data Center division revenue by a strong 115% annually and Data Center operating income by 405%. The results helped stem the annual drops in AMD's gaming and embedded business divisions, and its shares soared by more than 3% in the aftermarket as the results hit the wire.
AMD Grows Revenue By 9% Annually As AI Helps It Turn Year Ago Operating Loss Into Profit
AMD's second quarter financials were a beat all around, as apart from surpassing analyst revenue and EPS estimates, it also beat guidance estimates. Heading into today's results, Wall Street had expected the firm to guide $6.61 billion in revenue for the current quarter. AMD topped this by $90 million and guided $6.7 billion for a midpoint annual revenue growth of 16%.
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Out of AMD's four business divisions, two led the pack. These are the Client division, which accounts for CPU sales to consumers and the Data Center business that measures AMD's enterprise computing sales. Like its larger rival NVIDIA, AMD is now primarily a data center company, courtesy of the surge in enterprise computing over the past couple of years. This was evident through its Client and Data Center revenues, which came in at $1.5 billion and $2.8 billion during the second quarter, respectively.
AMD shared that the Client figures were due to sales of its Ryzen processors, as the $1.5 billion figure marked a 49%
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