AMD announces record-breaking revenues for 4Q 2019, RDNA GPU refresh confirmed for 2020

2019 was a great year for AMD and the latest earnings report proves the red team is on the rise, with even better projections for 2020. The jump to 7 nm combined with the difficulties Intel is still experiencing on the supply side have really helped AMD to consolidate its position, especially on the desktop / mobility CPU and discrete gaming GPU markets. During the earnings call, AMD CEO Lisa Su highlighted that the 4Q 2019 revenue reached US$2.13 billion, while the yearly revenue topped at a record-breaking US$6.73 billion, which is 4% higher than the 2018 one. Just to put things into perspective, Intel reported US$10 billion in revenues for the 4th quarter of 2019 alone.

Of the total US$6.73 billion from last year, AMD’s 7 nm Ryzen 3000 CPUs along with the Radeon RX 5000-series GPUs brought in US$4.7 billion, a 69% increase over the CPU + GPU revenues generated in 2018. Accordingly, AMD recorded the highest CPU sales in 6 years, while the GPU shipments grew by “double-digit” percentages YoY. AMD is projecting that the demand for its 7 nm CPUs will grow throughout 2020 and the company is taking steps in order to meet the market demand. This will include price adjustments, depending on what Intel brings to the table.

Regarding AMD’s upcoming GPU solutions coming in 2020, Su explained that “in 2019 we launched our new architecture in GPUs, it’s the RDNA architecture, and that was the Navi-based products. You should expect those will be refreshed in 2020 and we'll have our next-generation RDNA architecture that will be part of our 2020 lineup." More details on the RDNA refresh along with news on upcoming data center GPUs are to be revealed at AMD’s Investor Day in early March.

The latest AMD report also mentions a Q1 2020 outlook of US$1.8 billion, that appears to be a bit lower-than-expected, which triggered an immediate 4% stock price drop. This was corroborated with the not-so-stellar performance on the Enterprise,Embedded and Semi-Custom side of the business that also includes gaming console-related sales. However, this should take a turn for the better this year, as AMD will supply custom APUs for the upcoming PS5 and Xbox Series X consoles.

One important aspect to note is that AMD managed to reduce its debt by ⅔, from US$4.5 billion in 2009 to US$1.5 billion in 2019, with as much as 50% mitigated only in 2019. Overall, AMD expects a 45% gross margin and 30 % revenue increase for 2020.