Chipmaker Advanced Micro Devices Inc. (AMD) swung to a profit in the first quarter from a loss last year, as strong performance in its Computing and Graphics segment drove its revenue higher. The company also issued second-quarter revenue guidance that came above street expectations.
With revenues climbing 40% to $1.65 billion, the semiconductor company swung to quarterly earnings of $81 million or $0.08 per share, from a loss of $33 million or $0.04 per share a year earlier. On a non-GAAP basis, EPS were $0.11 compared to breakeven last year.
Revenue benefitted from strong sales of Radeon graphics, Ryzen processors and EPYC products.
Looking ahead into the second quarter of 2018, AMD predicts revenue of about $1.725 billion, plus or minus $50 million, an increase of 50% year-over-year, and non-GAAP gross margin of about 37%.
Off lately, demand for GPUs has been rising due to the wide use of artificial intelligence (AI) techniques and machine learnings tools in industries including gaming, automotive, and blockchain.
Client processor average selling price increased from last year, helped by a greater percentage of revenue from Ryzen products. Higher revenue from Radeon products drove average selling price of graphics processing unit. Enterprise, Embedded, and Semi-Custom (EESC) segment revenue fell 12% as lower semi-custom revenue overshadowed higher server and embedded revenue.
Cash rose 10.8% from last year as about 96% of it is held domestically. But on a sequential basis, cash for the period ended March 31, 2018, dropped 11.8% as the company lowered payables to related parties. It is expected that during next quarter, the company will have more cash due to the 63% increase in accounts receivable from December 30, 2017.
In contrast, the company needed quick financing to fund working capital needs as known from a 219% jump in short-term debt. The long-term debt had fallen drastically, while accumulated deficit narrowed slightly by 1.1%.
Shares of AMD ended Wednesday’s regular trading session down 3.77% at $9.71 on the Nasdaq Capital Market. The stock, which had been trading between $9.05 and $15.65 for the past 52 weeks, is now up 8.65% in the aftermarket hours.