This afternoon, AMD announced their earnings for the first quarter of their 2018 fiscal year, and their recent trend of performance has continued, with revenues for the quarter up 40% to $1.65 billion. Even more importantly, they’ve finally gotten to the point where they are able to achieve solid margins, which were 36% for this quarter, up 4% from last year. This led to operating incomes of $120 million, compared to just $11 million a year ago. Net income was $81 million for the quarter, compared to a $33 million loss last year. Earnings per share were $0.08, up from a $0.04 loss per share last year.

AMD Q1 2018 Financial Results (GAAP)
  Q1'2018 Q4'2017 Q1'2017
Revenue $1647M $1340M $1178M
Gross Margin 36% 34% 32%
Operating Income +$120M -$2M +$11M
Net Income +$81M -$19M -$33M
Earnings Per Share +$0.08 -$0.02 -$0.04

AMD has been in a situation where they’ve been relying on Non-GAAP measures to show the underlying business in the midst of restructuring debt and losses due to changing their wafer agreement, but these results are all GAAP, and all good. The big gains are thanks to the Computing and Graphics segment, which almost doubled in revenue compared to the same quarter last year. This group had revenues of $1115 million, compared to $573 million a year ago, which is a 94.6% increase. There’s likely no surprise here, but that increase is thanks to strong sales of both Radeon graphics, and Ryzen processors. Processor average selling price (ASP) increased thanks to more sales of Ryzen, and GPU ASP also increased, thanks to Vega, and likely the cryptocurrency craze which has definitely driven up prices. Operating income for this segment was $138 million for the quarter, compared to an operating loss of $21 million a year ago. Basically, there’s nothing but good news here, after far too long of struggling in this segment.

AMD Q1 2018 Computing and Graphics
  Q1'2018 Q4'2017 Q1'2017
Revenue $1115M $908M $573M
Operating Income +$138M +$33M -$21M

AMD’s other segment is their Enterprise, Embedded, and Semi-Custom segment, and this group is the ones that really carried them through the lean years, with AMD diversifying quite a bit into semi-custom SoCs, and it certainly helped that they got design wins in both the Sony PlayStation 4, and the Microsoft Xbox One. Revenue for this segment wasn’t quite as rosy as the Computing and Graphics, with quarterly revenues of $532 million, which was down 12% compared to Q1 2017. The revenue decline is attributed to lower semi-custom revenue, but somewhat offset by higher server and embedded revenue. EPYC processor revenue has helped, but not enough to offset the loss of revenue in semi-custom. Operating income for this segment was $14 million, compared to $55 million a year ago, but AMD attributed the majority of the operating income decrease to a licensing gain in Q1 2017 which inflated the numbers.

AMD Q1 2018 Enterprise, Embedded, and Semi-Custom
  Q1'2018 Q4'2017 Q1'2017
Revenue $532M $432M $605M
Operating Income +$14M -$13M +$55M

All Other had an operating loss of $32 million, compared to a loss of $23 million a year ago.

Overall, there’s little to be disappointed with here. Likely AMD is hoping for stronger EPYC sales to improve its segment, but the Computing and Graphics segment was strong enough to carry the day easily. Looking forward to next quarter, AMD is expecting revenues of $1.725 billion, plus or minus $50 million, which would be a 50% increase from Q2 2017.

Source: AMD Investor Relations

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  • Rictorhell - Wednesday, April 25, 2018 - link

    Very exciting news for AMD. I'm looking forward to the release of the 2nd generation Threadripper processors. I hope that things continue to improve for AMD from here on out. Reply
  • Dragonstongue - Wednesday, April 25, 2018 - link

    according to that one guy the other day "AMD has been in a loss situation for far too long, including all of 2017"

    apparently not ahahaha.

    awesome AMD keep it up, oh, and get some GPU out there that are closer to the MSRP for us gamers who have been waiting for far too long to get our paws on some nummy new graphics cards (40-60-180% over MSRP is not a good thing at all)

    Maybe try offering to sell via AMD.com directly would be a step in the right direction even if it is an AIB partner card at least (in theory) you may be able to tell much easier which AIB causes more problems than they are worth because after all with us customers buying the product tere would be no AMD ^.^

    Still do not understand why their share price is not $20+ USD considering how amazing a turn around they have done 2016 till now, jumped to $15 for a few days but has been bouncing around the $7-$12.50 or so since the initial "boom" of pre ryzen to ryzen release.

    I really wish byrons and such would stop bad mouthing AMD and look at what they have accomplished and have done for the industry on a whole, not just that they are not lining their ulterior motive pocket books O.o
    Reply
  • jjj - Wednesday, April 25, 2018 - link

    In other news, Jim Keller left Tesla and the crazy rumor is that he's going to Intel but that would be too funny. Reply
  • xype - Thursday, April 26, 2018 - link

    Heh, I always figured Keller is going around every company _but_ Intel, assuming he applied there first and they declined with "We don’t think you have the right koalafications, sorry." :P Reply
  • phoenix_rizzen - Thursday, April 26, 2018 - link

    Not much of a rumour anymore:

    https://www.google.ca/search?q=jim+keller+moves+to...
    Reply
  • iwod - Thursday, April 26, 2018 - link

    Why hasn't EPYC picked up stream? I wasn't expecting some massive jump, but it seems EPYC is selling a little below even the conservative expectation. Reply
  • jimjamjamie - Thursday, April 26, 2018 - link

    My guess is because the platform is so new, Xeon is still the 'safe' bet. I imagine it will take time to build up trust but solid results from the Ryzen chips will surely help with that. Reply
  • SaberKOG91 - Thursday, April 26, 2018 - link

    It also doesn't help that many of the server vendors don't have more than a handful or two of AMD server options. Couple that with Threadripper being a pretty good option for a Workstation level machine (it will even do non-registered ECC DIMMs) and it isn't a surprise that enterprise is lagging comparatively. Reply
  • TheinsanegamerN - Thursday, April 26, 2018 - link

    Trust. AMD screwed up the server world for years. When you have large numbers of servers, and you need to keep them all from the same CPU vendor to make migrating VM hosts easier, you dont want to choose a company that will fall asleep at the wheel every 2 minutes.

    Servers also last awhile. We replace our severs every 7-8 years because we dont always have money for new ones. We bought haswell last time around because bulldozer was so meh. EPYC is really interesting to us, but it will be another 2-3 years before we consider an upgrade. Other companies usually replace every 5 years for warranty purposes, but that means anybody that bought a server in 2013 or later isnt ready for new hardware yet. And there is the lack of AMD server options.

    EPYC is good, so is ryzen, but AMD needs to prove they can reliably deliver on good chips. Give it 2 or 3 years, and if AMD continues to deliver, you will see EPYC pick up steam.
    Reply
  • vanilla_gorilla - Thursday, April 26, 2018 - link

    Just wanted to echo this. My home PC is now Ryzen but I'm still not ready for EPYC in my datacenter. Hopefully by the next significant refresh I'll have some EPYC options. Reply

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