AMD expects record 2022 earnings buoyed by Ryzen 6000/7000 laptops release and Radeon sales, closes in on Intel's profit margins
AMD's revival is in full swing, as the chip designer attests in its latest quarterly and full 2021 fiscal year results report. AMD has managed to turn the market success of its Ryzen and Radeon brands into financial success, reporting record holiday quarter and a fiscal year beating all of its numbers in existence. AMD made US$4.8 billion in revenue for this past quarter alone, but what's most important is that it hit a 50% gross profit margin nearing Intel's 55% which would have been unthinkable just a few short years ago. Here are all the financial milestones of AMD in the holiday quarter and for the whole of 2021:
- Revenue of $4.8 billion was up 49 percent year-over-year and 12 percent quarter-over-quarter driven by higher revenue in the Computing and Graphics and Enterprise, Embedded and Semi-Custom segments.
- Gross margin was 50 percent, an increase of more than 5 percentage points year-over-year and approximately 2 percentage points quarter-over-quarter. The year-over-year and quarter-over-quarter increases were primarily driven by a richer product mix.
- Operating income was $1.2 billion compared to $570 million a year ago and $948 million in the prior quarter. Non-GAAP operating income was $1.3 billion compared to $663 million a year ago and $1.1 billion in the prior quarter. Operating income improvements were primarily driven by higher revenue and gross margin expansion.
- Net income was $974 million compared to $1.8 billion a year ago, which included a $1.3 billion income tax benefit associated with a valuation allowance release, and $923 million in the prior quarter. Non-GAAP net income was $1.1 billion compared to $636 million a year ago and $893 million in the prior quarter.
- Diluted earnings per share was $0.80 compared to $1.45 a year ago, which included a $1.06 per share income tax benefit, and $0.75 in the prior quarter. Non-GAAP diluted earnings per share was $0.92 compared to $0.52 a year ago and $0.73 in the prior quarter.
For the first quarter and the whole of the fiscal 2022, AMD projects equally impressive numbers, expecting revenue to climb by almost a third and gross margin to hit 51% this year. The Q1 revenue boost will be due to the February release of the first laptops with the new AMD Ryzen 6000 processors that are built on the frugal 6nm Zen 3+ architecture and package RDNA2 integrated graphics. AMD expects to launch its new Ryzen 7000 family of processors built on the next-gen 5nm manufacturing method in the second half of 2022 which would inevitably contribute to another blockbuster "laptops with Ryzen 7000" holiday sales spree.
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