AMD third-quarter revenue rises 9 percent year-over-year

AMD's third-quarter results rolled in. The company's revenue was up 9 percent year-over-year to $1.8 billion and non-GAAP netincome soared from $150 million to $219 million. This resulted in adjusted earnings per share of $0.18, versus $0.13 a year ago. Earnings per share were in-line with analyst's estimates while revenue came in $10 million lower than estimates. AMD's shares are currently up 0.61 percent to $33.23 in after-hours trading.

Getting down in the specifics, Computing and Graphics revenue was up 36 percent year-over-year, while revenue of the Enterprise, Embedded and Semi-Custom unit was down 27 percent year-over-year. AMD does not provide a lot of granularity but the company says the Computing and Graphics results were driven by higher Ryzen client CPU sales. The other unit saw higher EPYC server CPU sales but a big drop in semi-custom chip revenue.

AMD(NASDAQ:AMD) today announced revenue for the third quarter of 2019 of $1.80 billion, operating income of $186 million, net income of $120 million and diluted earnings per share of $0.11. On a non-GAAP(*) basis, operating income was $240 million, net income was $219 million and diluted earnings per share was $0.18.

“Our first full quarter of 7nm Ryzen, Radeon and EPYC processor sales drove our highest quarterly revenue since 2005, our highest quarterly gross margin since 2012 and a significant increase in net income year-over-year,” said Dr. Lisa Su, AMD president and CEO. “I am extremely pleased with our progress as we have the strongest product portfolio in our history, significant customer momentum and a leadership product roadmap for 2020 and beyond.

Q3 2019 Results

Revenue was $1.80 billion, up 9 percent year-over-year and 18 percent quarter-over-quarter due to higher revenue in the Computing and Graphics segment, partially offset by lower revenue in the Enterprise, Embedded and Semi-Custom segment.

Gross margin was 43 percent, up 3 percentage points year-over-year and 2 percentage points quarter-over-quarter, primarily driven by increased RyzenTM and EPYCTM processor sales.

Operating income was $186 million compared to $150 million a year ago and $59 million in the prior quarter. Non-GAAP operating income was $240 million compared to $186 million a year ago and $111 million in the prior quarter. The year-over-year and sequential increases were primarily due to higher revenue in the Computing and Graphics segment.

Net income was $120 million compared to $102 million a year ago and $35 million in the prior quarter. Non-GAAP net income was $219 million compared to $150 million a year ago and $92 million in the prior quarter.

Diluted earnings per share was $0.11 compared to $0.09 a year ago and $0.03 in the prior quarter. Non-GAAP diluted earnings per share was $0.18 compared to $0.13 a year ago and $0.08 in the prior quarter.

Cash, cash equivalents and marketable securities were $1.2 billion at the end of the quarter.

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For the fourth quarter of 2019, AMD expects revenue to be approximately $2.1 billion, plus or minus $50 million, an increase of approximately 48 percent year-over-year and approximately 17 percent sequentially. The year-over-year and sequential increases are expected to be driven by an increase in Ryzen, EPYC and Radeon product sales. AMD expects non-GAAP gross margin to be approximately 44 percent in the fourth quarter of 2019.