Despite recent concerns about chip security, Advanced Micro Devices CEO Lisa Su says her chip-making company has benefited from its bet on a line of new computer processors.
Advanced Micro Devices on Tuesday reported 34 percent year-over-year revenue growth that was boosted by a greater demand for its processors.
AMD reported $1.48 billion in sales and a profit of $61 million, or 6 cents per share for its fourth quarter, beating Wall Street expectations. Analysts polled by Zacks investment research had predicted earnings of 5 cents per share and $1.41 billion in sales.
The company also reported its 2017 full-year financial data. Its revenue was $5.33 billion, $610 million more than its 2016 fiscal year, and it had a profit of $43 million, or 4 cents per share, compared with a $497 million loss in 2016.
AMD is headquartered in California but has most of its senior management team based in Austin and employs about 1,500 people in Central Texas.
The company has been making gains after some years of underperforming. Industry analysts have said AMD is benefiting from demand in its graphic processor unit, which has widespread use now in the gaming, automotive and blockchain industries.
The company said Tuesday that its success in 2017 was primarily driven by its launch of its Ryzen processors and its Radeon graphics product.
During a conference call with investors Tuesday, AMD chief financial officer Devinder Kumar said 2017 “was a pivotal year for AMD. We have set a strong foundation for achieving our long-term model."
A year ago, AMD had reported $1.1 billion in sales and a net loss of $51 million.
After multiple quarters of losses, AMD posted a profit during its third fiscal quarter in 2017.
At the same time, some analysts have cautioned that AMD’s stock, which has risen more than 400 percent since 2016, could be at a premium now and set to drop.
AMD is also still responding to a security flaw in its chips that was unveiled by researchers earlier this month. AMD said this month that one of the two flaws found, named Spectre, was applicable to its chips, and that the company was working on fixes. Any impacts of the security flaw on AMD’s sales won’t be known until its next quarterly report.
"Security is and always has been a fundamental focus for AMD across all of our products," Su said on a call with investors Tuesday. "We are vigilant about security across our product design. We are dedicated with responding with speed and focus."
In a statement Tuesday, AMD said its efforts to prevent and address security flaws could be costly and could lead to other issues.
“For instance, AMD's mitigation efforts, including the deployment of software or firmware updates to address security vulnerabilities, could result in unintended consequences such as adverse performance system operation issues and reboots,” the company said.
AMD’s stock closed 3.38 percent lower on Tuesday at $12.87 per share. Its shares were trading up about 0.5 percent during after-hours trading.
Analysts expect growth for AMD as demand for its new chips in computing, graphics and visualization continues. Analysts at Zacks have said they expect the company to see 0.13 percent earnings growth during the next five years.
Su said AMD is planning to debut new processors this year, including an updated version of Ryzen.
"In 2018, we expect to increase our momentum with the next wave of premium products" Su said. "I'm excited for 2018."
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