Semiconductor firm Advanced Micro Devices (AMD) reported a 67% jump in earnings for the third quarter helped by higher revenue as well as lower cost of sales. The bottom line came in line with analysts’ expectations. Following this, the stock plunged over 21% in the after-market session.
Net income for the quarter climbed 67% to $102 million or $0.09 per share. Non-GAAP earnings increased 44% to $0.13 per share.
Revenue rose 4% to $1.65 billion. This was driven by higher client revenue in the Computing and business segments. The latest quarter revenue included IP-related revenue, of which $86 million was related to its THATIC joint venture.
Looking ahead into the fourth quarter, the company expects revenue of about $1.45 billion, plus or minus $50 million, an increase of about 8% year-over-year, and non-GAAP gross margin to rise to about 41%. This forecast is driven by the sales growth of Ryzen, EPYC and datacenter GPU processor sales.
Computing and Graphics segment revenue was $938 million, up 12% year-over-year. The growth was driven by strong sales of Ryzen desktop and mobile products, partially offset by lower graphics revenue. Blockchain-related GPU sales in the third quarter were negligible.
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Client processor average selling price was higher from the previous year quarter, primarily due to higher desktop and mobile processor average selling price. GPU average selling price decreased from last year, due to lower GPU channel sales.
Enterprise, Embedded, and Semi-Custom segment revenue declined 5% to $715 million. This decline was due to lower semi-custom product and IP-related revenue, partially offset by higher server sales.
Shares of AMD ended Wednesday’s regular session down 9.17% at $22.79 on the Nasdaq. The stock has risen over 59% in the past year and over 121% in the year so far.