Advanced Micro Devices (NASDAQ: AMD) Turns The Ship Around - Posts Earnings Per Share of 8 Cents on an Operating Loss of $8 Million for Q2 2022

Advanced Micro Devices (NASDAQ: AMD) Turns The Ship Around – Posts Earnings Per Share of 8 Cents on an Operating Loss of $8 Million for Q2 2022

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Avant-garde Micro Devices (NASDAQ: AMD) has finally posted an operating income (on a non-GAAP basis) and a net income (on a GAAP basis) after a very long fourth dimension. The company generated a revenue of $1.027 Billion on which information technology reported an operating loss of $eight 1000000 and a cyberspace income of eight cents per share (GAAP). The acquirement of the company has grown 23% sequentially and ix% year over year, which shows good for you growth in AMD's market segments.

AMD publishes strong Q2 2022 results based on solid semi-custom growth, pre-market share price up by ix.5%

"In the 2d quarter we accomplished a meaning milestone as we returned to non-GAAP operating profitability based on solid execution and stiff need for our semi-custom and graphics products," said Lisa Su, AMD president and CEO. "Based on the force of our semi-custom products and demand for our latest Radeon RX GPUs and seventh Generation A-Series APUs, we are well positioned to drive growth and market share gains in the 2nd half of the year."

AMD (NASDAQ: AMD) had a rather good quarter, in-fact, the result has been so well-received that the share price (at the time of writing and in Pre-Market) is up almost a full 10%! It is currently at $5.72 (Pre-Market place) which is around nine.58% more than final 24-hour interval'south shut.

Revenue growth was driven by the semi-custom business concern. This includes its agreement with Sony and Microsoft to provide them with APUs for the current generation and adjacent generation consoles. AMD's operating expenditures have been declining for the past couple of years and after closing the bargain with Nantong (NFME) they are expected to decrease fifty-fifty further. The visitor does not have whatsoever term debt maturities due until 2022. Since sales from the GPUs and Zen will mature in 2022, that remains the year which will decide the fate of the company for the long term.

As far as AMD'south (NASDAQ: AMD) segments go, the computing and graphics segment saw a seasonal quarter to quarter reject of 5% (clocking in revenue of $435M equally opposed to $460M last quarter) but saw salubrious growth of near 15% year over twelvemonth. The semi-custom SOC business concern increased 59% this quarter due to the concern cycle and 5% yr over year. This is likewise the only segment in AMD's division which posted an operating income (of $81 Million). Computing and Graphics, and all other categories posted operating losses of $92 One thousand thousand together.

Analyzing AMD's render to operating profitability (Non GAAP) and net income (GAAP)

AMD Price Targets Analysts are starting to agree with followers of the red giant on the future upside of the company.

The visitor has reported a very interesting mix of financials this year. On the GAAP side, they have an operating loss but a cyberspace income, while on the non-GAAP side, they have an operating income but a net loss. So what exactly does all of this mean? Well, I will be going through a detailed analysis and breakdown of the hows and whats of AMD'southward return to (op) profitability.

The visitor reported an operating loss of 8 Million dollars, yet eventually, nosotros are seeing a internet income of $69 Million. So how does that add upwardly? To keep things coherent. I will be comparing GAAP components to Non-GAAP components and showing you lot how everything adds upwards. Lets start with the difference in operating income.

AMD is reporting an operating loss of $8 Million on the GAAP side and an operating turn a profit of $3 Meg on the not-GAAP side.

The reason for this discrepancy is that under Non-GAAP measures, AMD is allowed to recognize stock-based compensation (roughly $18 Million in income) and must deduct restructuring and other special charges of $7 Million. Then the primary income driver here is the increase in AMD'southward share price, which has jumped quite a lot in the by few months. The nature of this driver is not sustainable in nature and does not reverberate intrinsic growth since its basically a feedback loop from the share toll.

Lets take a look at the difference in net income now. On the GAAP side, AMD is reporting a internet income of $69 Million, which is pretty damn impressive, and a net loss of $twoscore Meg on the Non-GAAP side.

The reason for that is that under GAAP measures, AMD is allowed to recognize the cash gain from its ATMP JV as other income gain. Which information technology did. It recognized $150 Million out of the $352M cash gain and that is what it primarily used to turn around effectually the ship. Since this is a one-off proceeds and non something sustainable, it is not recognizable under Not-GAAP basis. So if yous ignore the $150 million one-off proceeds, deduct the special restructuring charge while adding the stock bounty gain besides as the provision for taxes y'all become the internet loss of $40 1000000. Which is a much more accurate reflection of the current state of events, for investors that are in it for the long term.

We too noticed some decent growth drivers in AMD (NASDAQ: AMD)'s financials. The acquirement increase itself speaks volumes for the company. After virtually ten % increase over from last year, the company is on a very bullish trend. The visitor shifted to 14nm FinFETs and introduced its RX lineup of GPUs spear headed by the value monster - the RX 480. The full financial impact of the the RX 480, RX 470 and RX 460 moving in volume is not present in these financials, not to mention the company is on track to reveal Zen shortly. In other words, all indicators for intrinsic growth are nowadays in the visitor, we only have to wait for them to mature.

Non-GAAP	Q2-sixteen	Q1-16	Q2-15
Revenue	$1,027M	$832M	$942M
Operating income (loss)	$3M	$(55)M	$(87)M
Net loss / loss per share	$(40)M/$(0.05)	$(96)Yard/$(0.12)	$(131)M/$(0.17)

Not GAAP Quarterly Results of Advanced Micro Devices (NASDAQ: AMD) for Q2 2022.

GAAP	Q2-16	Q1-16	Q2-15
Revenue	$1,027M	$832M	$942M
Operating loss	$(viii)Grand	$(68)M	$(137)One thousand
Cyberspace income (loss) / earnings (loss) per share	$69M/$0.08	$(109)M/$(0.14)	$(181)One thousand/$(0.23)

GAAP Quarterly Results of Advanced Micro Devices (NASDAQ: AMD) for Q2 2022.

Key Highlights:

Computing and Graphics segment revenue of $435 million decreased five pct sequentially and increased xv percentage from Q2 2022. The sequential decrease was primarily due to decreased sales of client desktop processors and chipsets and the twelvemonth-over-yr increase was driven primarily by increased notebook processor and GPU sales.
- Operating loss was $81 million, compared with an operating loss of $70 million in Q1 2022 and an operating loss of $147 1000000 in Q2 2022. The sequential increase was primarily due to lower revenue. The year-over-year improvement was primarily due to higher revenue and lower operating expenses.
- Customer boilerplate selling cost (ASP) increased sequentially driven past a college desktop processor ASP and decreased yr-over-year primarily due to lower notebook processor ASP.
- GPU ASP remained apartment sequentially and decreased year-over-year. The year-over-year subtract was primarily driven by lower desktop GPU ASP.
Enterprise, Embedded and Semi-Custom segment revenue of $592 million increased 59 pct sequentially and increased 5 percent year-over-yr due to college sales of semi-custom SoCs.
- Operating income was $84 one thousand thousand compared with $xvi one thousand thousand in Q1 2022 and $27 million in Q2 2022 primarily due to higher revenue from the sale of semi-custom SoC products and a $26 1000000 IP licensing gain in Q2 2022 compared to $vii million in Q1 2022.
All Other category operating loss was $11 1000000 compared with $xiv one thousand thousand in Q1 2022 and $17 million in Q2 2022.

Fiscal Summary:

Q2 2022, Q1 2022 and Q2 2022 were 13-week fiscal quarters.
Revenue of $1,027 million, up 23 percent sequentially and up ix percent year-over-year primarily due to higher sales of semi-custom SoCs.
Gross margin of 31 percentage, down i percentage signal sequentially, due primarily to a higher mix of semi-custom SoC sales.
Operating expenses of $353 million, compared to $344 meg for the prior quarter. Not-GAAP operating expenses of $342 million, compared to non-GAAP operating expenses of $332 million in Q1 2022, primarily due to increased marketing investments.
Operating loss of $8 meg, compared to an operating loss of $68 one thousand thousand in Q1 2022. Non-GAAP(1) operating income of $3 million, compared to non-GAAP(one) operating loss of $55 million in Q1 2022, primarily due to higher sales.
Cyberspace income of $69 one thousand thousand, earnings per share of $0.08, and non-GAAP(ane) net loss of $40 million, not-GAAP(1) loss per share of $0.05. This is compared to a net loss of $109 one thousand thousand, loss per share of $0.14 and non-GAAP(1) internet loss of $96 million, non-GAAP(1) loss per share of $0.12 in Q1 2022. The GAAP sequential and yr-over-year improvements were primarily due to a gain of $150 million related to the formation of our assembly, test, marker and pack (ATMP) articulation venture (JV) with Nantong Fujitsu Microsystem electronics Co., Ltd. (NFME), partially start past related taxes of $27 million. The non-GAAP sequential and year-over-twelvemonth improvements were primarily due to higher sales and an IP licensing proceeds.
Cash and cash equivalents were $957 million at the end of the quarter, upward $241 million from the end of the prior quarter, primarily due to cyberspace cash gain received from the ATMP JV transaction with NFME which airtight in Q2 2022.
Total debt at the finish of the quarter was $ii.24 billion, flat from the prior quarter.

Advanced Micro Devices (NASDAQ:AMD) Q3 2022 Outlook

Revenue to increase 18% sequentially, +/‐ three%, primarily driven by our semi‐custom and graphics products, including new semi‐custom concern,
Gross margin to be approximately 31%,
Non‐GAAP operating expenses to be approximately $350 million due to an increment in R&D investments,
IP monetization licensing proceeds of approximately $22 million,
Maintain not‐GAAP operating profitability,
Involvement expense, taxes and other to be approximately $45 million,
Greenbacks and cash equivalents balances to be approximately flat quarter over quarter, Inventory to be approximately $700 1000000.

Source: https://wccftech.com/amd-quarterly-q2-2016-operating-loss-8-million/

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Advanced Micro Devices (NASDAQ: AMD) Turns The Ship Around - Posts Earnings Per Share of 8 Cents on an Operating Loss of $8 Million for Q2 2022