Industry Overview - The semiconductor industry is projected to grow from $631.01 billion in 2025 to $958.93 billion by 2030, with a CAGR of 8.73% during this period, driven by demand for AI and data center technologies [2] - Shipment volume in the semiconductor market is expected to increase from 1.40 trillion units in 2025 to 2.29 trillion units by 2030, at a CAGR of 10.32% [3] AMD Insights - AMD's data center revenues surged 57.2% year over year to $3.674 billion in Q1 2025, accounting for 49.4% of total revenues, driven by the adoption of EPYC processors [4] - The launch of the AMD EPYC 4005 Series processors in May 2025 is aimed at enhancing performance and efficiency for small and medium businesses [6] - AMD's partnerships with major hyperscalers like Oracle and Google Cloud have expanded the use of its EPYC CPUs, contributing to its growth [5] Semtech Insights - Semtech's data center revenues reached a record $51.6 million in Q1 fiscal 2026, up 143% year over year, driven by demand for CopperEdge and FiberEdge products [7] - The launch of the CopperEdge portfolio in April 2025 includes solutions that enable 800G and 1.6T connectivity for AI/ML data centers, focusing on power savings and performance [8] - Semtech has strengthened collaborations with cloud service providers, enhancing its position in next-generation data center infrastructure [9] Performance and Valuation - Year-to-date, AMD shares have decreased by 2.8%, while SMTC shares have fallen by 38.5%, attributed to a challenging macroeconomic environment [11] - Both AMD and SMTC shares are currently considered overvalued, with AMD trading at a forward Price/Sales ratio of 5.65X and SMTC at 3.09X [14] - The Zacks Consensus Estimate for AMD's 2025 earnings is $4.02 per share, reflecting a 21.45% year-over-year increase, while SMTC's fiscal 2026 earnings estimate is $1.66 per share, indicating an 88.64% year-over-year increase [16] Earnings Performance - AMD has consistently beaten earnings estimates over the past four quarters, with an average surprise of 2.30%, while SMTC has a higher average surprise of 10.83% [17] - Semtech's stronger earnings surprise history and innovative solutions position it as a more attractive investment compared to AMD [18]

Advanced Micro Devices (AMD) shares have soared 31.4% in the past month, outperforming the Zacks Computer and Technology sector’s increase of 19.4% and the Zacks Computer – Integrated Systems industry’s growth of 22.5%.The outperformance can be attributed to AMD’s expanding portfolio, accretive acquisitions and rich partner base. The strong adoption of fifth-gen EPYC Turin processors and expanding Instinct AI accelerator deployments across hyperscalers and enterprises have also been major growth drivers for ...

Advanced Micro Devices (AMD) Q1 2025 Earnings Call May 06, 2025 05:00 PM ET Company Participants Matt Ramsay - Corporate VP - Financial Strategy & IRLisa Su - Chair & CEOJean Hu - Executive VP, CFO & TreasurerJoshua Buchalter - Director - Equity ResearchTimothy Arcuri - Managing DirectorHarlan Sur - Executive Director - Equity ResearchThomas O'Malley - Director - Equity ResearchCJ Muse - Senior Managing Director Conference Call Participants Aaron Raikers - AnalystVivek Arya - AnalystStacy Rasgon - AnalystRo ...

Financial Data and Key Metrics Changes - First quarter revenue increased by 36% year over year to $7.4 billion, exceeding consensus estimates [5][28] - Net income rose by 55%, driven by a higher percentage of data center product sales and a richer Ryzen processor mix [6][30] - Gross margin expanded for the fifth consecutive quarter, reaching 54%, up 140 basis points from the previous year [29][30] Business Segment Data and Key Metrics Changes - Data Center segment revenue grew by 57% year over year to $3.7 billion, driven by increased server CPU share and strong demand from hyperscalers [6][31] - Client and Gaming segment revenue increased by 28% year over year to $2.9 billion, with client revenue specifically growing by 68% [19][32] - Embedded segment revenue decreased by 3% year over year to $823 million, with expectations of gradual recovery [24][33] Market Data and Key Metrics Changes - The number of EPYC powered cloud instances activated by enterprise customers more than doubled year over year [8] - Demand for AMD's latest generation AI PC processors increased by over 50% quarter on quarter [20] - The gaming revenue decreased by 30% year over year, primarily due to lower semi-custom sales, although demand signals for 2025 have strengthened [22][23] Company Strategy and Development Direction - The company is focusing on expanding investments in product and technology roadmaps, go-to-market initiatives, and AI software solutions [26][27] - The launch of the fifth generation EPYC processors is expected to drive continued share gains in the data center market [10][11] - The acquisition of ZT Systems aims to enhance the company's capabilities in providing rack-level AI solutions [16][27] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in delivering strong double-digit revenue growth in 2025 despite macroeconomic uncertainties [26][35] - The company anticipates a significant impact from new export license requirements, estimating a $1.5 billion revenue reduction for the full year [35][36] - Management highlighted the strength of their differentiated product portfolio and execution as key factors for future growth [6][26] Other Important Information - The company completed the acquisition of ZT Systems on March 31, enhancing its systems design expertise [16][34] - The first production shipments of the fifth generation EPYC processors are expected in the second half of 2025 [11][34] Q&A Session Summary Question: Drivers of upside in Q1 and guidance for Q2 growth by segment - Management noted strong performance across client, gaming, and data center businesses, with particular strength in desktop performance and ASPs [41][44] Question: Performance of the Instinct family in Q1 and outlook for the second half - Management indicated that the data center GPU business performed in line with expectations, with high customer interest in the upcoming MI350 launch [49][50] Question: Clarification on data center GPU growth expectations - Management confirmed that the data center GPU business is expected to grow strong double digits despite the headwinds from export controls [83][84] Question: Inventory increase reasons - The increase in inventory was primarily to support strong client and server ramp, as well as the upcoming data center GPU ramp [57][58] Question: Feedback on MI400 series and addressing deployment challenges - Management expressed high enthusiasm for the MI400 series and emphasized the importance of planning and collaboration with customers to address deployment challenges [61][62] Question: Client business growth expectations and market share - Management highlighted strong performance in the client business, particularly in high-end notebooks and desktops, with expectations for continued share gains [80][92]

Advanced Micro Devices (AMD) Q1 2025 Earnings Call May 06, 2025 05:00 PM ET Company Participants Matt Ramsay - Corporate VP - Financial Strategy & IRLisa Su - Chair & CEOJean Hu - Executive VP, CFO & TreasurerJoshua Buchalter - Director - Equity ResearchTimothy Arcuri - Managing DirectorHarlan Sur - Executive Director - Equity ResearchThomas O'Malley - Director - Equity ResearchCJ Muse - Senior Managing Director Conference Call Participants Aaron Raikers - AnalystVivek Arya - AnalystStacy Rasgon - AnalystRo ...