Advanced Micro Devices Inc. stated that it intends to use its expanding product line to withstand new export restrictions on China.
AMD Chief Executive Lisa Su stated on Tuesday during the company’s fiscal first-quarter earnings call that the company believes the “dynamic” macroeconomic environment and the new China sales restrictions for its Instinct MI308X “are more than offset by the powerful tailwinds from our leadership-product portfolio.”
According to Su, based on share gains with its “Zen 5” Epyc and Ryzen central processing units as well as its Radeon graphics processing units, the business still anticipates double-digit percentage revenue growth this year. According to Su, the business also intends to increase manufacturing of its Instinct MI350 accelerators in the second half of 2025.
“We view the current environment as a strategic opportunity to further differentiate AMD as we deliver an expanding product portfolio that combines leadership compute and AI capabilities for data centers, edge, PCs and embedded end devices,” Su stated.
The chip manufacturer reported first-quarter financial results on Tuesday that exceeded Wall Street’s forecasts, following a difficult period for the stock this year.
The chip manufacturer reported sales of $7.4 billion for the March quarter, which was 36% higher than the previous year and higher than the $7.1 billion analysts had predicted, according to FactSet’s compilation of analyst projections. Wall Street was anticipating 94 cents per share, but AMD posted adjusted earnings of 96 cents.
Tuesday after-hours trading saw a 1.8% increase in AMD’s shares (AMD).
According to FactSet, the company’s data-center business generated $3.7 billion in revenue, although investors had anticipated $3.5 billion. According to the business, sales of its Epyc CPUs and Instinct GPUs were primarily responsible for the 57% increase in data center revenue over the previous year.
“We delivered an outstanding start to 2025 as year-over-year growth accelerated for the fourth consecutive quarter, driven by strength in our core business and expanding data-center and AI momentum,” Su stated in a statement.
According to Su, the company’s first-quarter performance and its expectations for the second quarter “highlight the strength of our differentiated product portfolio and consistent execution positioning us well for strong growth in 2025.” Su also discussed the current macroeconomic and regulatory climate.
The company exceeded Wall Street’s forecast of $7.2 billion by setting its second-quarter revenue guidance at $7.4 billion, plus or minus $300 million.
Strong demand for AMD’s Zen 5 Ryzen CPUs drove a 68% increase in client-segment sales to $2.3 billion from the prior year. However, the business stated that “primarily due to a decrease in semicustom revenue,” its gaming-segment revenue dropped 30% to $647 million.
AMD’s stock fell over 2% on Tuesday, and it has lost about 18.2% of its value this year.
The business stated that it anticipates adjusted gross margins for the June quarter to be approximately 43%, including $800 million in fees associated with the licenses needed to sell its MI308X chips to Chinese consumers under the new U.S. export restrictions.
