AMD Rises Despite Q4 Sales Miss, Weak Guidance

Advanced Micro Devices, Inc. AMD shares are up 5 percent despite reporting a fourth-quarter sales miss.

Fourth-quarter earnings came in at 8 cents per share, falling in-line with analyst estimates. Revenues came in at $1.42 billion, missing estimates by $30 million. The company issued first-quarter sales guidance of $1.25 billion, short of consensus estimates of $1.45 billion.

"In 2018 we delivered our second straight year of significant revenue growth, market share gains, expanded gross margin and improved profitability based on our high-performance products. Importantly, we more than doubled our EPYC processor shipments sequentially and delivered record GPU datacenter revenue in the quarter," said Dr. Lisa Su, AMD president and CEO. "Despite near-term graphics headwinds, 2019 is shaping up to be another exciting year driven by the launch of our broadest and most competitive product portfolio ever with our next-generation 7nm Ryzen, Radeon, and EPYC products."

Other Highlights

• Revenues down 14 percent sequentially due to lower revenue in the Enterprise, Embedded and Semi-Custom segment;
• Non-GAAP Gross margin was 41 percent, compared to 34 percent a year ago; and
• Cash, cash equivalents and marketable securities were $1.16 billion at the end of the quarter, up $100 million sequentially.

For the full year 2019, AMD expects high single-digit percentage revenue growth driven by Ryzen, EPYC and Radeon datacenter GPU product sales as the company ramps 7nm products throughout the year.

Shares traded up 3.6 percent at $19.95 in Tuesday's after-hours session. The stock dropped 4.6 percent in the regular trading session.