Advanced Micro Devices Q4 Report Reaffirms Bullish Thesis

Shares of Advanced Micro Devices, Inc. AMD, a global semiconductor company, has seen its stock soar nearly 375 percent over the past year.

Investors and traders appear to be convinced the already strong gains seen since the stock bottomed at $1.81 can be sustained as the stock was trading higher by more than 5 percent following the company's fourth quarter results.

AMD reported after Tuesday's close that it lost $0.01 per share on revenue of $1.11 billion. Wall Street analysts were expecting the company to lose $0.02 per share on revenue of $1.07 billion.

Q4 Highlights

• Revenue rose 15 percent year-over-year although Q4 2016 was a 14-week fiscal quarter versus 13 weeks a year ago.
• Revenue was lower by 15 percent sequentially, mostly due to seasonally lower sales of semi-custom SoCs.
• Gross margin rose 2 percentage points year-over-year to 32 percent and rose 27 percent points sequentially as last quarter was impacted by a $340 million charge.
• Operating loss improved to $3 million from an operating loss of $49 million a year ago and $293 million from the prior quarter.
• Cash and cash equivalents rose $6 million from the end of the prior quarter to $1.26 billion.

2017 Outlook

• Revenue is expected to fall 11 percent sequentially, plus or minus 3 percent.
• The midpoint of guidance would result in first quarter revenue rising around 18 percent year-over-year.

Management Commentary

"We met our strategic objectives in 2016, successfully executing our product roadmaps, regaining share in key markets, strengthening our financial foundation, and delivering annual revenue growth," Dr. Lisa Su, AMD president and CEO said in the company's press release. "As we enter 2017, we are well positioned and on-track to deliver our strongest set of high-performance computing and graphics products in more than a decade."