Advanced Micro Devices (AMD) is a big tech company from the U.S., based in Santa Clara, California. It started in 1969 and makes CPUs (central processing units) and GPUs (graphics processing units), which are important for computers. AMD’s products are used in gaming, data centers, AI, and other areas. They are known for their Ryzen processors, Radeon graphics cards, and EPYC server processors. AMD focuses on creating advanced computing solutions for both everyday users and businesses.
For more than 50 years, AMD has been making high-performance computing, graphics, and visualization technologies better. AMD creates top-tier, adaptable products that push the limits of technology.
AMD Fiscal Q1 2025
Advanced Micro Devices (AMD) reported strong Q1 2025 financial results, with revenue reaching $7.4 billion, exceeding estimates.
The company posted a 50% gross margin, $806 million in operating income, and $709 million in net income, with diluted earnings per share (EPS) of $0.44.
On a non-GAAP basis, gross margin was 54%, operating income totaled $1.8 billion, net income was $1.6 billion, and EPS came in at $0.96 surpassing expectations.
Highlights:
- Data Center segment: $3.7 billion revenue, up 57% YoY, driven by growth in AMD EPYC CPU and AMD Instinct GPU sales.
- Client and Gaming segment: $2.9 billion revenue, up 28% YoY.
- Client revenue: $2.3 billion, up 68% YoY, fueled by strong demand for “Zen 5” AMD Ryzen™ processors and a richer product mix.
- Gaming revenue: $647 million, down 30% YoY, due to a decline in semi-custom revenue.
- Embedded segment: $823 million revenue, down 3% YoY, as demand in end markets remained mixed.
Outlook
AMD’s outlook for Q2 2025 is based on current expectations, with actual results potentially varying due to market conditions. The company projects revenue of approximately $7.4 billion, plus or minus $300 million. Non-GAAP gross margin is expected to be 43%, factoring in $800 million in inventory-related charges due to new export controls. Without these charges, the non-GAAP gross margin would be around 54%.
Boards Statements
According to AMD Chair and CEO Dr. Lisa Su, AMD delivered an outstanding start to 2025, with year-over-year growth accelerating for the fourth consecutive quarter. She attributed the strong performance to the company’s core businesses and the increasing momentum in data center and AI.
Despite challenges in the macroeconomic and regulatory landscape, Su emphasized that AMD’s first-quarter results and second-quarter outlook highlight the strength of its differentiated product portfolio and consistent execution, positioning the company well for robust growth throughout the year.
Jean Hu, AMD’s EVP, CFO, and Treasurer, stated that the company achieved a 36% year-over-year increase in first-quarter revenue and demonstrated significant earnings leverage as its business continues to scale. She reaffirmed AMD’s commitment to long-term growth and value creation for shareholders, citing ongoing investments in research and development as well as go-to-market initiatives.
Impact on the Stock Market
AMD’s Q1 2025 earnings boosted its stock by over 5%, thanks to strong revenue and EPS. Investors are optimistic about AMD’s growth in data centers and AI.
However, the stock has struggled, down 33% year-over-year, due to competition with Nvidia, export restrictions, and economic concerns.
Investors have mixed opinions on AMD. Some see AI as a big opportunity, while others worry about regulatory challenges. Future performance will depend on AMD’s ability to gain market share in AI chips, particularly against Nvidia, and how it navigates export controls affecting China sales.
