AMD Earnings Report, Q4 FY 2018: Closing On A Profitable 2018
by Brett Howse on January 29, 2019 10:10 PM EST- Posted in
- CPUs
- AMD
- Financial Results
- Ryzen
AMD announced their fourth quarter earnings for their 2018 fiscal year today, and the company has continued its upward trajectory, with revenue gains of 6% year-over-year to $1.42 billion. Gross margin, which was long a burden for the company, is now right in the sweet spot at 38%, up 4% from a year ago. Operating income for the quarter was $28 million, compared to an operating loss of $2 million last year, and net income is now in the black as well at $38 million, compared to a net loss of $19 million a year ago. That resulted in earnings per share of $0.04, compared to a $0.02 loss per share in Q4 2017.
| AMD Q4 2018 Financial Results (GAAP) | |||||
| Q4'2018 | Q3'2018 | Q4'2017 | |||
| Revenue | $1419M | $1653M | $1340M | ||
| Gross Margin | 38% | 40% | 34% | ||
| Operating Income | $28M | $150M | -$2M | ||
| Net Income | $38M | $102M | -$19M | ||
| Earnings Per Share | $0.04 | $0.09 | -$0.02 | ||
Computing and Graphics has been the main contributor of AMD’s resurgence ever since AMD’s Ryzen CPU was launched, and revenue for this segment was up 8.6% to $986 million. Even more important, operating income for the segment was up 248% to $115 million. AMD sounds to have a busy year for 2019 which should be great news for its investors and customers.
| AMD Q4 2018 Computing and Graphics | |||||
| Q4'2018 | Q3'2018 | Q4'2017 | |||
| Revenue | $986M | $938M | $908M | ||
| Operating Income | $115M | $100M | $33M | ||
Enterprise, embedded, and semi-custom didn’t perform quite as well, with revenue more or less flat year-over-year at $433 million. AMD’s APU wins in both the Xbox and PlayStation have contributed a lot to this segment over the last couple of years, but the enterprise CPU space may be a bit tougher nut to crack than the consumer market, but the flat revenue is deceiving, since EPYC sales are offsetting lower semi-custom sales. AMD’s operating loss for this segment did improve though, with a $6 million loss this quarter compared to a $13 million loss a year ago, thanks to the higher margins in enterprise processors.
| AMD Q4 2018 Enterprise, Embedded, and Semi-Custom | |||||
| Q4'2018 | Q3'2018 | Q4'2017 | |||
| Revenue | $433M | $715M | $432M | ||
| Operating Income | -$6M | $86M | -$13M | ||
AMD’s All Other had a sizeable loss this quarter at $81 million, compared to a $22 million loss a year ago. AMD chalks this up to a $45 million charge related to older technology licenses.
Meanwhile, as Q4 is the final quarter of AMD's fiscal year, it means that AMD is reporting their overall performance for the year. Much like AMD's performance in their recent quarter, 2018 was a strong year for the company – bouyed in part by their best quarter in seven years – giving AMD it's first fully profitable year in quite some time.
| AMD FY 2018 Financial Results (GAAP) | |||||
| 2018 | 2017 | 2016 | |||
| Revenue | $6.48B | $5.25B | $4.27B | ||
| Gross Margin | 38% | 34% | 23% | ||
| Operating Income | $451M | $127M | -$372M | ||
| Net Income | $337M | -$33M | -$497M | ||
| Earnings Per Share | $0.32 | -$0.03 | -$0.60 | ||
Overall the company came close to profitability in 2017, however on a GAAP basis, fell a bit short for the year. 2018 however had no such issues, with AMD booking a net income of $337 for the year. AMD has now been profitable for several quarters, marking a significant turnaround for a company that was previously losing hundreds of millions of dollars every year.
In addition to their earnings, AMD also announced a seventh amendment to their wafer agreement with Global Foundries, outlining costs for the next couple of years.
For Q1 2019, AMD expects revenue to be about $1.25 billion, plus or minus $50 million, which will be a 24% decrease over Q1 2018, due to the lack of cryptocurrency sales, but offset but CPU sales.
Source: AMD Investor Relations
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KOneJ - Tuesday, January 29, 2019 - link
2019 could be a blowout year if Zen 2 and EPYC deliver.BigMamaInHouse - Wednesday, January 30, 2019 - link
About Navi:https://seekingalpha.com/article/4236505-advanced-...
Targon - Monday, February 4, 2019 - link
Navi has been on track for a late Q2 or early Q3 2019 release for the past year and possibly longer. The question has mostly been the exact details of Navi, as well as WHEN the high end version of Navi would show up as the replacement for Vega. The first post-GCN GPU from AMD has also been a big question when it comes to the release plans.webdoctors - Tuesday, January 29, 2019 - link
"net income is now in the black as well at $38 billion"Really? They made $38 BILLION dollars?! Damn. Thats amazing.
Brett Howse - Tuesday, January 29, 2019 - link
Never good for the brain when AMD and Apple have earnings the same day! Fixed up thanks.johnNDenver - Wednesday, January 30, 2019 - link
But, they only had "AMD booking a net income of $337 for the year".Maybe missing an 'M'?
ksec - Wednesday, January 30, 2019 - link
I wish AMD do better, this is not "good", but barely got out of downward spiral. It is Chinese New Year soon I hope they have a tremendous year of pig, EPYC 2 and Zen 2 hopefully will rule the market.Targon - Monday, February 4, 2019 - link
When both Intel and NVIDIA had bad results, even a "not bad" result should be seen as good. Ryzen, Threadripper, and Epyc have actually been a nice upward spiral for AMD, gaining traction as more than the enthusiast crowd have evaluated the products and found them worth buying.SydneyBlue120d - Wednesday, January 30, 2019 - link
Go Lisa, go!!! 😎👌🔝eddman - Wednesday, January 30, 2019 - link
I hope their financials keep improving and their CPUs stay competitive. Intel makes good products but I simply cannot convince myself to buy from them anymore, when AMD is offering so much at lower prices and a proper upgrade path.Now only if they could come up with a GPU architecture that could rein in nvidia.