Advanced Micro Devices reported their quarterly earnings Tues. afternoon. Their earnings and revenue beat estimates. They also said their revenue for the second quarter will be in-line with expectations and maintained their full-year earnings guidance thanks you the expected launch of their new 7-nanometer Ryzen, Radeon and EPYC processors in the coming months.
So the news seemed positive, no need to be cautious right, so why are analyst all over the place with their targets? Is it because Intel reported their first annual profit decline since 2015 and said their full-year guidance that was below Wall Street expectations last week.
Morgan Stanley Sees Solid Report Overall
AMD’s first-quarter report was largely in-line with expectations, with 23-percent year-over-year revenue declines for the first quarter, in-line second-quarter guidance and reiteration of full-year guidance, Moore said in a Wednesday note.
The analyst said he expects AMD’s 7nm product portfolio to help in the second half, but Morgan Stanley’s outlook is below the implied second-half guidance, primarily due to softness in graphics.
BofA Likes Guidance, But Sees Little Room For Error
Despite the weak demand environment flagged by Intel, AMD impressively maintained its outlook for high single-digit sales growth in 2019, Arya said. The guidance comes despite a 20-percent drop in console sales and tougher compares in graphics, a sector that was boosted last year by crypto sales, he said.
BofA is maintaining its above-consensus estimates and projects that sales growth will accelerate from 8 percent in 2019 to 22 percent in 2020 on the back of broad-based growth in CPU, GPU, semi-custom and emerging game streaming markets.
Mizuho: AMD ‘Well-Positioned’
AMD’s in-line second-quarter revenue guidance and 41-percent gross margin guidance reflects continued ramps of Ryzen and EPYC that are driven by increasing adoption in PC and desktop, Rakesh said in a Wednesday note.
“With the GPU overhang removed, and AMD maintaining its guide for a 2H ramp with Rome and 7nm gaming Navi, and a targeted ~10% data center share by 1H20, AMD is well-positioned.”
Despite price rising 45% year to date,
the chart suggests rough waters will be encountered at the monthly supply at $34.
This post is my personal opinion. I’m not a financial advisor, this isn’t financial advise. Do your own research before making investment decisions.