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Home / Business / If you did not believe in the AMD turnaround before, these earnings should convince you

If you did not believe in the AMD turnaround before, these earnings should convince you



Advanced Micro Devices Inc. was a battlefield resource as it sought to diversify beyond personal computers and become a true competitor to larger competitors such as Intel Corp. and Nvidia Corp.

To be a battlefield is now blown away.

AMD

AMD, -0.86%

reported its best quarterly earnings in over seven years on Wednesday afternoon, despite an expected decline in revenue from cryptocurrency mining, which was cited by many as the main reason for the gains of the past year. While the sale of graphics cards at AMD was reinforced by the buyers of cards, similar to Nvidia

NVDA, + 1

.27%

seem to be improving the chipmaker's efforts to improve its high-performance PC and server offerings, offset a decline there and justify the work of Chief Executive Lisa Su. [196592002] The Complete Profit Story: AMD Stock Rising for Best Seven-Year Earnings

Overall, AMD posted a net profit of $ 116 million, or 11 cents a share, after a loss of $ 42 million a year. and the company's largest GAAP gain since the March 2011 quarter. Adjusted for stock-based compensation and other effects, earnings increased to 14 cents per share. Revenues were $ 1.76 billion, up more than 50% from a year ago and 7% sequentially and the highest quarterly revenue since 2008.

This performance should tell you that this time is different and investors seemed to be agree and send shares in after-hours trading by around 5%. AMD has long been the saddest step to Intel

INTC, + 0.48%

seems to have plans that would make him a more competitive rival before repeatedly failing and falling behind in past decades. This time around, AMD seems to be on its quest as Intel struggles with processes and products, leaving Nvidia's surge in data center chips enough room for a challenger.

The company's computer and graphics segment grew 64% in the quarter, Su said in the conference call on Wednesday, despite blockchain-related sales of about 10% of AMD sales dropping to 6%. This gap was closed by the performance of AMD's one-year Epyc series of server GPUs, which grew 50% in both units and Radeon graphics and Ryzen PC chips in the previous quarter.

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"AMD shows that its Ryzen and Epyc processor families, as well as the Radeon graphics group, can compete and gain market share," said Ryan Shrout, principal analyst for Shrout Research and occasionally MarketWatch contributor.

This ability to challenge Intel and Nvidia was not taken for granted, as Su paves the way for a bigger challenge at games and servers, but AMDs, performance this year shows that it happened. Now the company has to continue executing to take advantage of the position in which it has positioned itself.

"It's important for AMD's future to run flawlessly across the 7nm line to capitalize on the potential market opportunities Intel and Nvidia Currently dominate," said Moor Insights and Strategy chief analyst Patrick Moorhead to MarketWatch on Wednesday referring to manufacturing processes that are at the heart of chip manufacturing.

If this were the AMD of old, it would be hard to trust the company would be able to execute. It's a lot easier to believe with the numbers Su has produced this year.

The AMD share has so far gained 56.1% this year before the post-earnings gains. The S & P 500 Index

SPX, + 0.91%

has risen by 6.5% and the PHLX Semiconductor Index

SOX, + 0.49%

added 7.5% over the same period.


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