Advanced Micro Devices Inc (AMD), the leading challenger to Nvidia Corp in artificial intelligence (AI) computing chips, gave a surprisingly robust sales forecast, showing that it is cashing in on a flood of data center spending.
Second-quarter revenue would be US$11.2 billion, plus or minus US$300 million, the company said in a statement on Tuesday.
That compares with an average analyst prediction of US$10.5 billion, data compiled by Bloomberg showed.
Photo: Bloomberg
The outlook signals that AMD is winning orders from the biggest spenders on AI computing. Although Nvidia remains the dominant provider of AI processors, data center customers are increasingly seeking alternatives — a trend that has helped AMD.
AMD is the second-largest maker of AI accelerators — chips that are used to train and run AI services. Its product lineup also includes microprocessors that serve as the heart of server computers, as well as graphics chips that are used in laptop and desktop PCs.
The company’s first-quarter sales rose 38 percent year-on-year to US$10.3 billion. Profit, minus certain items, was US$1.37 a share. Analysts had predicted revenue of US$9.89 billion and earnings of US$1.28 per share.
Revenue at its data center business grew 57 percent to US$5.8 billion. Analysts had predicted US$5.61 billion on average.
PC-related sales rose 23 percent to US$3.6 billion.
AMD has benefited from renewed interest in its central processing units (CPUs). That type of generalist chip is increasingly being deployed in gear used to run AI software.
The data center CPU market would grow at “greater than 35 percent annually, reaching over US$120 billion by 2030,” AMD said.
“In response to this demand, we are working closely with our supply chain partners to meaningfully increase our wafer and back-end capacity to support this growth,” AMD CEO Lisa Su (蘇姿丰) said on a conference call with analysts.
AMD’s server CPU revenue would grow more than 70 percent in the current quarter, the company said, adding that “robust growth” would continue through the second half of this year into next year.
The company had growing confidence in its ability to generate tens of billions of dollars in annual data center revenue next year, Su said, adding that she expects to exceed AMD’s long-term growth target of greater than 80 percent in the coming years.
The industry does face some challenges, though. Like other tech companies, AMD is contending with an unwanted side effect of the build-out in new AI data centers: a memory shortage.
“We are planning for second half PC shipments to be lower due to higher memory and component costs,” Su said. “Against this backdrop, we still expect our client revenue to grow year-over-year and outperform the market.”
After several years flying high as Asia’s best Nvidia Corp proxy, Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) is increasingly vying with other artificial intelligence (AI) stocks for investor attention. Stock traders are chasing a wider array of beneficiaries as mainstream usage of AI creates demand for hardware beyond the most-advanced chips TSMC makes for Nvidia. Subthemes from the deepening memory crunch to advances in robotics are also luring bids. At the same time, investment caps on single stocks are pushing funds to diversify, while retail investors long familiar with TSMC through its US depositary receipts are being offered a broader set of
Netherlands-based semiconductor equipment supplier ASML Holding NV yesterday said that it is planning to hire an additional 1,000 people in Taiwan this year in response to growing demand from clients. ASML had previously planned to recruit 600 people this year, but that the plan has been adjusted upward, ASML vice president and ASML Taiwan general manager Grace Wang (汪佳慧) told reporters. ASML has a workforce of more than 4,500 in Taiwan, accounting for about 10 percent of its global total, Wang said. This year’s recruitment campaign would focus on adding people in the customer support, manufacturing and supply chain domains to assist ASML
UNDER MICROSCOPE: Taiwan detained three people who allegedly conspired to buy servers in Taiwan and export them using fraudulent documentation, prosecutors said Nvidia Corp chief executive officer Jensen Huang (黃仁勳) on Saturday urged Super Micro Computer Inc to tighten up on compliance after Taiwan detained three people this week for allegedly making fraudulent declarations about artificial intelligence (AI) servers made by its US partner. The development marked the nation’s first crackdown on semiconductor smuggling, which grew after the US slapped restrictions on exports of high-end chips such as Nvidia AI accelerators to China. Nvidia is “rigorous” in explaining regulations to all of its partners, Huang told reporters after arriving in Taipei. “Ultimately Super Micro has to run their own company,” he said in response to
Nvidia Corp yesterday announced that CEO Jensen Huang (黃仁勳) would attend an employee meeting in Taipei tomorrow to celebrate the launch of the company’s Taiwan headquarters project. Huang would attend a gathering at the site of Nvidia’s planned headquarters in Beitou Shilin Technology Park (北投士林科技園區), the company said in a statement. After arriving in Taiwan on Saturday last week, Huang told reporters that he plans to meet with Quanta Computer Inc (廣達) chairman Barry Lam (林百里) and Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) chairman C.C. Wei (魏哲家), and would attend the groundbreaking ceremony for Nvidia’s Taiwan headquarters tomorrow. Nvidia has not yet applied
RSS