Chip giant AMD (AMD) will report its first-quarter results after the bell on Tuesday. This announcement follows the disappointing report from rival Intel last week. While Intel (INTC) reported top and bottom line results, the company provided lower-than-expected revenue guidance for the current quarter, sending shares lower.
Investors and analysts will look at two key metrics in AMD’s report: AI chip sales and PC market performance. The company launched its MI300 line of AI accelerators in December 2023 and began shipping units shortly after. How well these chips sell could have a big impact on AMD’s stock following the earnings announcement.
Wall Street expects earnings per share (EPS) of $0.61 on revenue of $5.45 billion. This would mark a slight increase from the same quarter last year, where AMD reported EPS of $0.60 on revenue of $5.35 billion.
AMD’s MI300 chips are expected to rival Nvidia’s (NVDA) best-selling H100 accelerator line. The company previously said its MI300X beats Nvidia’s chips, a claim Nvidia rejected. Intel is also chasing Nvidia’s H100 platform with its Gaudi 3 accelerators.
Nvidia, however, announced its follow-up to the H100, the Blackwell platform, at its GTC conference in March. This platform should offer better performance than its predecessor.
The AI arms race won’t slow down anytime soon, either. Microsoft (MSFT), Google (GOOG, GOOGL), and Meta (META) each announced that they are investing in AI data center capabilities to develop and support their various software offerings.
But it remains to be seen whether AMD will be able to steal significant market share from market leader Nvidia. MI300X sales are expected to bring in billions this year, according to Timothy Arcuri, an analyst at UBS Global Research.
“We still estimate $5-6 billion to be conservative for MI300 revenue this year and we also think the guidance is good,” he wrote in a note to investors ahead of the earnings release.
For the quarter, Wall Street is forecasting $2.31 billion in data center revenue, which would equate to a year-over-year increase of 78% from the same period last year. ‘last year.
Aside from AI sales, Wall Street will be interested in the recovery of the PC market and its impact on AMD sales. According to IDCGlobal PC shipments increased 1.5% in the first quarter of 2024, marking the first quarter of growth after two years of decline.
Intel already reported a 31% year-over-year increase in revenue at its customer group, the company’s PC chip segment, in its most recent quarter. This should bode well for AMD. Both companies offer their own AI PCs, or laptops and desktops capable of running generative AI applications locally rather than over the web.
Analysts claim revenue for AMD customers,…
