AMD: What The Street Is Saying Ahead Of Chipmaker's Q4 Print

Advanced Micro Devices, Inc. AMD is scheduled to release fourth-quarter results Tuesday after the market closes. Analysts are projecting strong top- and bottom-line performance. 

AMD's Q4 Metrics: Analysts, on average, estimate earnings per share of 47 cents on revenue of $3.02 billion for the quarter. This compares to EPS of 32 cents and revenue of $2.13 billion one year ago. 

The company guided to revenue of about $3 billion, plus or minus $100 million, on the basis of the ramp of new Ryzen, EPYC and semi-custom products and growing customer momentum, and a gross margin of about 45%.

Rosenblatt Securities analyst Hans Mosesmann said he expects sales and EPS to come in ahead of the consensus estimates.

Revenue growth will likely be driven by data center, notebook CPU momentum and game console ramps, the analyst said in a note. 

Rosenblatt estimates mid-single-digit sequential growth in Computing and Graphics, accounting for about 65% of revenue, and low-double-digit growth in the Enterprise, Embedded and SemiCustoms segments.

Cascend Securities analyst Eric Ross said graphics card activity in the supply chain remains incredibly high, in part driven by crypto. Data center offerings, specifically EPYC, are gaining steam, with major data center buyers thronging to the company, Ross said.

Related Link: AMD Analyst Projects Strong Start To 2021 For Chipmaker

AMD's Outlook: At the Credit Suisse Tech Conference, AMD CEO Lisa Su said the first quarter could be better than seasonal, and that 2021 should see the PC total addressable market grow, even off a high 2020 base.

Rosenblatt's Mosesmann said he will seek clarity on supply chain issues plaguing the semiconductor sector.

The analyst expects the company to guide to above-consensus sales and EPS for the March quarter.

The consensus estimates for the quarter call for EPS of 35 cents and revenue of $2.73 billion.

"We see design win dynamics for the company being very strong and are expected to lead to continued momentum through 2021 and 2022," Mosesmann said. 

AMD can capture 50% of the entire x86 CPU market in coming years on technology and product roadmaps, accelerating design pipelines, increasing attach rates of GPUs to optimize EPYC server CPUs and more, he said. 

Cascend's Ross sees Intel Corporation's INTC turnaround as a long, drawn-out one, as the company is plagued by a process engineering issue. AMD will have a head start over its rival, he said. 

AMD Stock: AMD shares doubled in 2020 and have added a little over 1% year-to-date. 

Rosenblatt reiterated a Buy rating and $120 price target for AMD shares.

Cascend Securities raised the price target for AMD from $100 to $110.

AMD Price Action: At last check, AMD shares were trading 0.65% higher to $94.74. 

Related Link: AMD Analysts See Momentum Ahead, With Xilinx Deal Expanding Market Opportunity

Photo: Paul Sakuma Photography/courtesy of AMD.