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AMD Nasdaq· Advanced Micro Devices Inc.
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AMD Nasdaq· Advanced Micro Devices Inc.
Earnings report Q4 2023

AMD Experiences Slight Revenue Decline Amid Mixed Demand Environment

Segments of Revenue

AMD's net revenue for the year was $22.7 billion, marking a 4% decrease from the previous year's $23.6 billion. This decline was primarily due to a 25% decrease in the Client segment revenue, attributed to lower processor sales, and a 9% decrease in the Gaming segment revenue due to lower semi-custom product sales. However, these losses were partially offset by a 17% increase in the Embedded segment revenue, largely due to the inclusion of embedded product revenue from Xilinx, Inc. for the full year, and a 7% increase in Data Center segment revenue, driven by higher sales of AMD Instinct GPUs and 4th Gen AMD EPYC CPUs.

Strengths

Despite the overall decrease in revenue, AMD demonstrated resilience with a 17% increase in Embedded segment revenue and a 7% increase in Data Center segment revenue. The inclusion of full-year embedded product revenue from Xilinx, Inc. and higher sales of AMD Instinct GPUs and 4th Gen AMD EPYC CPUs contributed to these increases. Additionally, the company's gross margin improved slightly, from 45% to 46%.

Challenges

AMD faced significant challenges in the Client and Gaming segments, with revenues decreasing by 25% and 9% respectively. Lower processor and semi-custom product sales were the primary drivers of these declines. The company also operates in a mixed demand environment, which could pose further challenges.

Noteworthy

AMD's operating results tend to vary seasonally, with net revenue generally higher in the second half of the year. However, market conditions and product transitions could impact these trends.

Summary

AMD experienced a slight decrease in net revenue in the face of a mixed demand environment. While the Client and Gaming segments struggled, the Embedded and Data Center segments showed promising growth. The company's gross margin also improved slightly. Looking ahead, AMD will need to navigate the challenges presented by its mixed demand environment and potential market fluctuations.

Source documents

Form 10-K  filed on Jan 31, 2024
133 pages scanned

Reference data

Company financials Q4 revenue 6.17B
Analyst estimates Q4 EPS beat by 13.94%
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