Late Monday, Advanced Micro Devices (AMD) reported their first quarter financial results and it looks like AMD lost four cents a share on revenue that rose 18% year over year, to $984 million. The earnings report report covered the fiscal Quarter and that means AMD Ryzen 7 and Ryzen 5 processor sales numbers are being taken into account. The report noted that Computing and Graphics segment revenue was $593 million, up 29 percent year-over-year and down 1 percent sequentially. AMD noted that the sequential decrease was primarily due to a decrease in Radeon GPU sales, but that was largely offset by initial revenue from the new Ryzen desktop processors. It appears that AMD has aggressively priced the new Ryzen series processors to spur interest and demand and it looks like they have a pretty low margin on them.
“We achieved 18 percent year-over-year revenue growth driven by strong demand for our high performance Ryzen CPUs as well as graphics processors,” said Dr. Lisa Su, AMD president and CEO. “We are positioned for solid revenue growth and margin expansion opportunities across the business in the year ahead as we bring innovation, performance, and choice to an expanding set of markets.”
This news has AMD stock down over 24% at one point today and it ended up closing at $10.30 per share, which is down $3.32 per share (24.38%). This appears to be the worst day for AMD stock in over a decade. For the second quarter of 2017, AMD expects revenue to increase approximately 17 percent sequentially, plus or minus 3 percent. AMD’s “Vega” GPU architecture is on track to launch in Q2 along with AMD’s high-performance x86 server CPU, codenamed “Naples”. The AMD Vega GPU is a high-end GPU that was designed from scratch to hopefully compete with NVIDIA in the high-end discrete graphics card market for consumer desktop PCs. Will AMD be able to turn things around next quarter?