Is It a Good Time to Buy AMD in US?
By Shiva Kumar
AMD just finalized its acquisition of Xilinx to expand into data centers, but will the company be able to manage the supply chain and inflationary hurdles that lie ahead in 2022?
After the closing bell on Tuesday, Advanced Micro Devices (AMD 1.44 percent) posted earnings, and shares were up over 6% after hours on the news.
The company recorded a 71 percent increase in sales in the first quarter, with both the top and bottom lines beating expectations.
AMD's adjusted earnings per share were $1.13, compared to $0.91 projected, a 117 percent rise year over year.
Many analysts expected AMD to cut guidance due to supply chain difficulties and inflationary macroeconomic factors.
The fact that AMD predicts $6.5 billion in revenue in the current quarter, which is higher than analyst projections of $6.38 billion, is perhaps the most stunning earnings news.
Raising guidance in this economy has undoubtedly raised some eyebrows, so let's dive a little further.
In addition, AMD said it repurchased $1.9 billion of its shares in the quarter, leaving $8.3 billion in stock repurchase authorizations.
AMD is involved in several secular growth themes, including gaming, the metaverse, cryptocurrency, data centers, the cloud, and more, but will it maintain its present valuation?
The stock was down over 40% this year as of Tuesday's close, but it was gaining after hours. Revenue increased by 71 percent year over year to $5.89 billion from $5.52 billion.
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