While Intel Corp. states data-center consumers are “digesting,” they seem to still be bellying up to a longtime competitor’s buffet.
Advanced Micro Gadgets Inc.’s server-chip sales are not having any of the problems that its big competing gone over last week (when Intel said data-center sales come by 20%) leaving financiers with the obvious conclusion: AMD AMD, -0.23% needs to be taking some market share far from Intel INTC, -1.34% in the sought after data-center business. AMD reported record quarterly sales Tuesday afternoon, and Chief Executive Lisa Su exposed that data-center sales had actually doubled from the same time in 2015.
AMD executives and financiers have long imagined again ending up being a legitimate competitor to Intel in the server and data-center market, and Su appears to have actually made that dream come true. Its Epyc line of server chips experienced enormous sales growth in the very first quarter that Intel’s Xeon did not. Sadly, AMD again avoided providing raw sales figures to judge, but at least Su provided a qualitative step different from the also-booming semi-custom business, which provides chips for both of the new video gaming consoles on the marketplace.
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” Based on both AMD and Intel’s earnings reports, I do believe that AMD took a little bit of server share from Intel,” stated Patrick Moorhead, primary analyst at Moor Insights and Method. “AMD unfortunately does not report Epyc income and blends with semi-custom, but I do think Epyc grew revenue while Xeon profits decreased.”
AMD also believes that momentum in data center will continue. Executives included more than $1 billion to their annual revenue guidance, and said sales in the existing quarter would grow by more than 85%. One analyst, Vivek Arya with BankofAmerica Securities, asked where AMD gets that confidence, opening Su up for a dig at Intel.
” Might you give us some sense of what has changed in the last 3 months, since your rival was just recently discussing cloud digestion, and you’re raising assistance by $1.3 billion,” Arya asked.
” I believe we saw actually strong signals in the very first quarter that it would be a strong data-center year for us,” Su said. “The supply chain has been tight general for the semiconductor industry, and we have actually been working extremely closely with our supply-chain partners and so we likewise have excellent visibility to extra supply as we go throughout the year.”
While declining to call out the bigger rival that for many years has foiled her predecessors’ efforts to compete with it, Su still said what she needed to– while Intel may face a demand problem for its server chips, AMD is only concerned about supply as it enters what she called a “high efficiency computing mega cycle.” That fact alone must suffice to give executives at Intel indigestion.