AMD raises forecasts for the full year as chip rival Intel stumbles

(Reuters) – Advanced Micro Devices Inc (AMD.O) Boosted its full-year revenue forecast on Tuesday, fueled in part by an overall surge in demand for chips due to a global shift to work from home, and market share gains from Intel Corp (INTC.O)

AMD shares rose 10% in extended trading after it also forecast sales in the current quarter above Wall Street’s targets. The stock has gained around 50% this year through Tuesday’s close as investors applauded its success on next-generation chips, at a time when Intel faces delays in building 7-plus chip technology. small and fast.

AMD, which relies on outside foundries to manufacture its chips, has begun to take Intel’s market share with offers made in Taiwan Semiconductor Manufacturing Co Ltd’s (2330.TW) 7nm process technology.

In a conference call with analysts, AMD CEO Lisa Su said that the ability to make 7nm chips at TSMC’s factories was “poor” but that AMD believes it can meet demand as customers change from Intel.

“The year-round increase is because demand has increased from our initial expectations, and part of that is due to the market, and part of that is due to the strength of our product pull. We are increasing the capacity to meet those needs. But it’s tight, ”Su said.

AMD also met its double-digit market share target for server processors, Su said.

Revenue from AMD’s computing and graphics segment, which includes graphics chip sales to data centers, rose 45% to $ 1.37 billion, beating analyst estimates of $ 1.36 billion, according to research firm FactSet. .

AMD now expects 2020 revenue to grow roughly 32%, driven by robustness in PC, gaming and data center products.

Third-quarter revenue is expected to be approximately $ 2.55 billion, plus or minus $ 100 million, compared to analysts’ average estimate of $ 2.32 billion, according to IBES data from Refinitiv.