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AMD Raises Outlook After Earnings Beat in Q2; Shares Surge

Published 07/28/2020, 04:20 PM
Updated 07/28/2020, 04:41 PM
© Reuters. AMD Earnings, Revenue Beat in Q2

By Yasin Ebrahim

Investing.com - Advanced Micro Devices surged in after-hours trade on Tuesday as the chipmaker raised its full-year revenue forecast after reporting second-quarter results that beat analysts' forecasts, led by record notebook and server processor sales.

AMD said it now expects 2020 revenue to grow by approximately 32% year-on-year, driven by strength in PC, gaming and data center products. Non-GAAP gross margin was expected to be approximately 45%.

Advanced Micro Devices (NASDAQ:AMD) was up 8.2% in after-hours trade.

AMD announced earnings per share of 18 cents on revenue of $1.93 billion. Analysts polled by Investing.com anticipated EPS of 16 cents on revenue of $1.85 billion.

"We delivered strong second quarter results, led by record notebook and server processor sales as Ryzen and EPYC revenue more than doubled from a year ago,” said Dr. Lisa Su, AMD president and chief executive. “Despite some macroeconomic uncertainty, we are raising our full-year revenue outlook as we enter our next phase of growth driven by the acceleration of our business in multiple markets.”

 
For the third quarter of 2020, AMD guided revenue of about $2.55 billion, give or take $100 million, an increase of approximately 42% year-over-year and 32% sequentially.
 
The upbeat outlook for the third quarter was expected to be primarily driven by Ryzen and EPYC processor sales and next generation semi-custom products, the company said.
 
"After a 50% rally this year, investors have built in strong expectations for a positive earnings surprise from AMD," said Investing.com analyst Haris Anwar. "The chipmaker is benefiting from a pandemic-triggered demand surge coming from personal computers, data centers and gaming consoles. But what investors are really looking for is the future outlook once the market settles and how the company has positioned itself to take advantage of Intel’s weakness and grab a greater market share."
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