AMD celebrates record quarter on strong data centre results

AMD’s acquisition of Xilinx earlier this year has turned the company into a “data centre powerhouse,” say analysts, and pushed the company to its first $5 billion+ quarter.

The chip-maker reported revenues of $5.9 billion for Q1'22, with a net income of $786 million - up 70% and 42% YoY, respectively, and its best-ever result.

Even excluding Xilinx, which AMD acquired in February, the firm still made record revenues of $5.3 billion.

Analysts say the Xilinx acquisition has turned AMD into a "data centre powerhouse," and the segment results support that claim.

The Computing & Graphics segment - responsible for most of AMD's CPUs and GPUs - made $2.8 billion revenue, up 33% YoY, thanks to higher average prices, driven mostly by more sales of high-end Radeon processors. Operating income was $723 million, a 49% increase.

The Enterprise, Embedded and Semi-Custom segment, which holds AMD's EPYC server processors, reached $2.5 billion revenue (up 88% YoY) and a record $881 million operating income (up 218% YoY). Higher revenue and an $83 million licensing gain were the main drivers for the result. Notably, multiple cloud customers - including Microsoft and Google - are now using EPYC processors for specific applications.

Xilinx generated $559 million partial quarter revenue and $233 operating income post-acquisition, and over $1 billion for the whole quarter.

The only segment to see a loss was ‘All Other', which includes expenses and credits not aligned with the other segments. This segment makes no revenue and thus always operates at a loss. That loss widened significantly to $886 million, from $100 million last year, primarily due to amortisation of intangible assets and acquisition-related costs.

AMD predicts an even better result in Q2'22, forecasting revenues of $6.5 billion (+/- $200 million), up about 69% YoY. Its full-year forecast is similar upbeat: $26.3 billion, up 60% versus 2021.