AMD bets on sturdy demand for chips as income soars 93{69439eabc38bbe67fb47fc503d1b0f790fcef507f9cafca8a4ef4fbfe163a7c5}

(Reuters) — Superior Micro Gadgets (AMD) raised its annual income forecast on Tuesday, betting on sturdy demand for its chips utilized in knowledge facilities and private computer systems as its chief govt stated she was assured the corporate might supply the chips regardless of a worldwide provide scarcity.

The chip designer’s shares rose about 4{69439eabc38bbe67fb47fc503d1b0f790fcef507f9cafca8a4ef4fbfe163a7c5} in prolonged buying and selling after it additionally reported better-than-expected outcomes for the primary quarter.

CEO Lisa Su stated AMD has “good visibility” into having the ability to safe further chips from its manufacturing companions.

“Your complete semiconductor provide chain could be very, very tight,” she advised analysts on a convention name. “That being stated, we’ve been working very carefully with our provide chain companions. We now have seen enhancements which have led to the improved full yr information.”

AMD has been prying away central processor chip market share from Intel, whose manufacturing operations have fallen behind contract factories utilized by AMD, akin to Taiwan Semiconductor Manufacturing Co.

It has additionally benefited from a surge in demand for its graphics chips from avid gamers who’ve spent extra time taking part in and upgrading their gear through the COVID-19 pandemic.

The corporate stated it now anticipated 2021 income to rise 50{69439eabc38bbe67fb47fc503d1b0f790fcef507f9cafca8a4ef4fbfe163a7c5} from a yr earlier, implying a determine of $14.64 billion, in contrast with its earlier forecast of a 39{69439eabc38bbe67fb47fc503d1b0f790fcef507f9cafca8a4ef4fbfe163a7c5} bounce.

Income within the first quarter soared 93{69439eabc38bbe67fb47fc503d1b0f790fcef507f9cafca8a4ef4fbfe163a7c5} to $3.45 billion, beating a Refinitiv IBES estimate of $3.21 billion, thanks partly to larger common promoting costs for its chips.

“We really feel excellent about our progress, significantly in notebooks,” Su stated. “We’re seeing traction within the premium ultrathin, gaming and industrial” pocket book markets.

Gross sales in AMD’s computing and graphics enterprise, which incorporates graphics and central processor chips for private computer systems, rose 46{69439eabc38bbe67fb47fc503d1b0f790fcef507f9cafca8a4ef4fbfe163a7c5} to $2.10 billion.

Its enterprise, embedded and semi-custom section, the unit that homes knowledge middle chips, posted an nearly four-fold bounce in gross sales to $1.35 billion.

Excluding objects, the corporate earned 52 cents per share, exceeding expectations of 44 cents per share.