Another strong quarter for AMD despite GPU sales decrease

AMD Logo
(Picture: AMD)

Yesterday AMD released its Q3 2018 earnings. Sales and profits increased again despite losses in the GPU market.

Another strong quarter for AMD

AMD is currently still on the road to success. The company is doing very well with its Zen and Zen 2 processor architecture, which is also clearly reflected in the quarterly reports of the last two years. This quarter is no exception. Both sales and profits have risen sharply. The chip manufacturer can continue to maintain this level well. AMD’s sales were $1.653 billion, $69 million higher than in the third quarter of 2017. Operating profit increased from $119 million to $150 million and net income from $61 billion to $102 billion.

Compared to the second quarter of 2018, however, the figures are not quite as bright. AMD’s sales were $103 million lower, but its operating profit was only $3 million lower. Net income decreased from $116 million to $102 million. Shifts have occurred primarily in the GPU market.

Strong server division, bursting mining bubble

AMD is also feeling the effects of the bursting of the mining bubble. Since mining with graphics cards is no longer as profitable, the manufacturer has recorded significantly lower sales in the graphics card segment than in the previous quarter. Turnover in the Computing and Graphics division fell from USD 1.083 billion to USD 938 million. However, compared to the year-ago quarter, this area also increased by $103 million. Operating income was $100 million, $17 million less than the previous quarter, but $27 million higher than the year-ago quarter.

The Enterprise, Embedded and Semi-Custom segment also offers an extremely interesting constellation. This includes both the Epyc server processors and the APUs for Playstation and Xbox. While the server division is booming, the decline in console sales is also noticeable in the figures. Revenue decreased to $715 million from $749 million in the year-ago quarter, but operating profit increased to $86 million from $74 million. Revenues declined slightly as console sales declined. However, as Epyc’s increased sales are significantly more profitable for AMD, operating profit increased well. Radeon Instinct server graphics cards are also said to have contributed significantly to the higher profit. Compared to the second quarter of 2018, AMD increased revenue by $45 million and operating income by $17 million.

Good perspectives for AMD

In the near future, AMD could continue to see a significant upswing. The company plans to launch Vega 20, the first 7nm graphics card, this year. At the beginning of 2019, the CPU architecture will also change to the 7nm structure width with Zen 2. The first products are to be launched with Epyc 2. Later, Ryzen 3000 will follow with Zen 2 and 7nm structure width. Later in 2019, Navi, the long-awaited successor of Polaris, will be launched on the market. AMD might use the opportunity and take some market shares from Intel, especially in the processor sector. The competitor is currently struggling with massive production problems with the 14nm process and further delays with 10nm. A recent analysis even says that Intel is completely dropping the 10nm process and use 7nm instead, which the company denies.

About Florian Maislinger 1222 Articles
Florian Maislinger is author and founder of PC Builder's Club. As a skilled IT engineer, he is very familiar with computers and hardware and has been a technology lover since childhood. He is mainly responsible for the news and our social media channels.

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