Advanced Micro beats by $0.02, beats on revs; guides Q3 revs above consensus; raises FY17 sales growth (14.11 -0.05)
- Reports Q2 (Jun) earnings of $0.02 per share, $0.02 better than the Capital IQ Consensus of ($0.00); revenues rose 19.0% year/year to $1.22 bln vs the $1.16 bln Capital IQ Consensus, driven by higher revenue in the Computing and Graphics segment. Revenue was up 24 percent sequentially, driven by increased sales in both business segments. Gross margin was 33 %, up 2 percentage points year-over-year due to a richer product mix and a higher percentage of revenue from the Computing and Graphics segment, driven by the first full quarter of Ryzen processor sales.
- Computing and Graphics segment revenue was $659 million, up 51 percent year-over-year, driven by demand for graphics and Ryzen desktop processors. Operating income was $7 million, compared to an operating loss of $81 million in Q2 2016. The year-over-year improvement was driven primarily by higher revenue and improved product mix. Client average selling price (ASP) increased significantly year-over-year, as desktop processor ASP increased due to the first full quarter of Ryzen processor shipments. GPU ASP increased year-over-year. Enterprise, Embedded and Semi-Custom segment revenue was $563 million, down 5 percent year-over-year primarily due to lower semi-custom SoC sales. In the quarter, AMD reached an important milestone by recognizing initial revenue from EPYC datacenter processor shipments.
- Co issues upside guidance for Q3, sees Q3 revs of +20-26% Q/Q to ~$1.47-1.54 bln vs. $1.39 bln Capital IQ Consensus Estimate; adj. gross margin ~34%.
- Raises FY17 rev growth to mid to high teens % from low double digits; semi-custom revenue to be down year-over-year based on the maturity of the current game console cycle, non-GAAP gross margin to be ~34%, achieve non-GAAP net income.