Advanced Micro Devices (AMD) said it expects revenue of $6.5 billion, an increase of 69 percent year-over-year, with gross margin of 54 percent in the second quarter of 2022.
The increase is expected to be driven by the addition of Xilinx and higher server, semi-custom and client revenue, AMD earnings report said.
Spending on cloud infrastructure services rose 34 percent to $55.9 billion in the first quarter, according to data from research firm Canalys, highlighting huge opportunities for companies supplying chips and other hardware to the industry.
AMD expects revenue of $26.3 billion in 2022, an increase of 60 percent, up from prior guidance of 31 percent, driven by the addition of Xilinx and higher server and semi-custom revenue. AMD expects gross margin of 54 percent for 2022, up from prior guidance of 51 percent.
AMD announced revenue of $5.9 billion, gross margin of 48 percent, operating income of $951 million, operating margin of 16 percent, net income of $786 million and diluted earnings per share of $0.56 for the first quarter of 2022.
First quarter 2022 results include partial quarter results from the recently completed acquisition of Xilinx which closed February 14, 2022.
Excluding Xilinx, AMD had record quarterly revenue of $5.3 billion, gross margin of 51 percent and operating margin of 30 percent.
AMD Chair and CEO Lisa Su said: “Each of our businesses grew by a significant double digit percentage year-over-year, led by EPYC server processor revenue more than doubling for the third straight quarter.”
AMD’s revenue of $5.9 billion was up 71 percent year-over-year and 22 percent quarter-over-quarter driven by higher revenue in the Computing and Graphics and Enterprise, Embedded and Semi-Custom segments and the inclusion of Xilinx revenue.
Record Computing and Graphics segment revenue was $2.8 billion, up 33 percent driven by Ryzen and Radeon processor sales.
Client processor average selling price (ASP) increased year-over-year and quarter-over-quarter driven by a richer mix of Ryzen processor sales.
GPU ASP increased year-over-year driven by high end Radeon processor sales and decreased quarter-over-quarter due to a lower mix of data center GPU revenue.
Record Enterprise, Embedded and Semi-Custom segment revenue was $2.5 billion, up 88 percent year-over-year and 13 percent quarter-over-quarter driven by higher EPYC processor revenue, semi-custom and embedded product sales.
Xilinx partial quarter revenue was $559 million with operating income of $233 million. Xilinx generated over $1 billion of revenue, up 22 percent year-over-year, driven by growth across all Xilinx major end market categories.
AMD recently announced an agreement to acquire Pensando for approximately $1.9 billion. Pensando’s distributed services platform will expand AMD’s data center product portfolio with a high-performance data center processing unit (DPU) and software stack.