Earnings Results: AMD stock pops as forecast quells fears about data-center sales, excess inventory

by | Nov 1, 2022 | Stock Market

Advanced Micro Devices Inc. shares rose in the extended session Tuesday after the chip maker’s data-center sales held up in quarterly earnings, and started rallying after Chief Executive Lisa Su said the outlook included getting rid of excess inventory by the end of the year. AMD
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shares, which had been up about 2% in the extended session after results were first released, ended after-hours trading up 4% after Su told analysts on a conference call that the company expects to have excess inventory flushed from its system by the end of the year, and costs are worked into an outlook that just falls short of Wall Street expectations. In the regular session, shares declined 0.4% to finish at $59.66.

For the fourth quarter, AMD forecast revenue of $5.2 billion to $5.8 billion, with its embedded and data-center segments “expected to grow,” with revenue of $23.2 billion to $23.8 billion for the year and gross margins of about 51%. Analysts had estimated revenue of $5.95 billion for the fourth quarter, and $24.16 billion for the year. That would suggest data-center sales were not being reduced like the $1 billion cut to PC sales — about the same dollar amount that Wall Street lowered their forecasts for the year by, on average, foll …

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