Thanks to the continuing popularity of its Ryzen and Epyc processors, AMD’s revenue hit $1.65 billion in Q3 2018—up from $1.58 billion in Q3 2017. But this figure was less than the $1.76 billion it brought in last quarter, and…
Thanks to the continuing popularity of its Ryzen and Epyc processors, AMD’s revenue hit $1.65 billion in Q3 2018—up from $1.58 billion in Q3 2017. But this figure was less than the $1.76 billion it brought in last quarter, and around $50 million lower than what analysts predicted. Net income, meanwhile, hit $102 million, beating last year’s $61 million figure but down from the $116 million it made in Q2 2018. Gross margin for the quarter was 40 percent.
“We delivered our fifth straight quarter of year-over-year revenue and net income growth driven largely by the accelerated adoption of our Ryzen, Epyc and data center graphics products,” said CEO Lisa Su. “Client and server processor sales increased significantly although graphics channel sales were lower in the quarter. Looking forward, we believe we are well positioned for further market share gains as we continue making significant progress towards our long-term financial targets.”
The company’s GPU sales saw slower than expected growth, partly because of their inability to compete against Nvidia’s products, and partly due to the shrinking cryptocurrency market. AMD’s cards had been popular among cryptominers, but the falling price of digital currencies has seen demand drop in recent months. “Blockchain-related GPU sales in the third quarter were negligible,” said the firm, while back in Q3 2017, these cards made up a “high single digit percentage of total AMD revenue.”
AMD’s net revenue from its Computing and Graphics segment was $938 million in Q3, while analysts had forecast $1.05 billion.
Despite the results, some experts are optimistic about AMD’s future. “I wasn’t expecting much from the graphics division in the quarter anyway,” said Patrick Moorhead, president and principal analyst at Moor Insights & Strategy. “I am not expecting any major change in GPU market dynamics until the seven-nanometer Navi launches, which I believe will improve its position, particularly in the enterprise market.”
Su said graphic sales were expected to be up in Q4, but investors are concerned that the overall guidance for the final quarter of the year is weak. AMD estimates fourth-quarter revenue of $1.4 billion to $1.5 billion, below Wall Street’s forecast of $1.6 billion.
AMD stock fell 22.55 percent to $17.65 a share in after-hours trading following the report.
Main image credit: Shutterstock / michelmond
