AMD posted a massive 99% revenue jump in the second quarter of 2021 on strength of sales in enterprise, data center and gaming segments, and gave a positive outlook for the second half of this year, fueled in part by continuing data center strength.
Overall, the company reported $3.85 billion in revenue for the most recent quarter, representing that 99% year-over-year growth and 12% growth over the first quarter of this year. A huge driver of that increase was the enterprise segment, where revenue was up a whopping 183% year-over-year to $1.6 billion.
Within that segment both data center-related sales and gaming-related sales were strong, according to AMD CEO and President Lisa Su. AMD did not break out revenue figures from the quarter for either sub-segment, but company leaders said on AMD’s earnings call late Tuesday that data center revenue represented about 20% of all revenue for the quarter, and was up a few percentage points from the first quarter of the year.
“We believe that our data center business will be a strong drive of growth for us into the second half of this year,” Su said. The company’s robust data center sales stand in contrast to a roughly 9% decline in that segment for AMD competitor Intel last quarter, as Intel appears to be under pressure in the data center market from both AMD and Nvidia.
Shortage to improve
Another topic on which AMD’s and Intel’s views appear to differ--at least slightly--is the ongoing semiconductor shortage and related supply chain constraints. Less than a week after Intel CEO Pat Gelsinger said on his company’s earnings call that he expects the effects of the shortage still will be felt for up to the next two years, Su Tuesday struck a more optimistic note, saying she expects the situation to “improve in 2022.”
“It’s fair to say demand in the semiconductor environment and in AMD’s environment has been very strong,” Su said. “And we have been seeing the constraints that other companies have been talking about, and we still do see some level of constraints. But we made some progress building up our supply during the second quarter, and we expect to be building up our supply quarter to quarter.”
Su added that AMD had worked closely with partners on that build up, and while she did not name names, a Marketwatch report earlier this week suggested that Taiwan’s TSMC could be giving AMD some preferential treatment over Intel, helping to boost AMD’s wafer position because TSMC may be irked by Intel’s recent moves in the foundry business.
Bright outlook
Bolstered by second quarter revenue strength and its claims of strengthening supply, AMD also gave a bright outlook for the third quarter and the full year. For the current quarter, AMD expects revenue to come in at around $4.1 billion, which would represent a 46% year-over-year increase and a 6% quarter-over-quarter increase, the latter of which is likely to be fueled by continuing data center and gaming growth. For the full year 2021, AMD now expects revenue growth of about 60%, up from prior guidance of approximately 50%.
In addition to the bright outlook for the rest of 2021, Su also said AMD’s proposed $35 billion acquisition of Xilinx is “remains on track” to close by the end of this year. The deal last month earned European Union and U.K. regulatory approval, but still needs China to weigh in.
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