AMD raises AI chip sales forecast to US$5 billion for 2025
Revenue in AMD’s data centre business, which includes AI chips, surged 122 per cent to US$3.5 billion in the fourth quarter
Advanced Micro Devices on Tuesday forecast fourth-quarter revenue just shy of estimates and raised its artificial intelligence chip sales forecast to US$5 billion for 2025 – not enough to impress investors.
AMD stock slid nearly 7 per cent in extended trading, erasing most of the 8 per cent gain in the last three trading days and much of the more than 10 per cent gained this year. Demand for AI chips from big technology companies including Microsoft and Meta has been rising much faster than their supply from AMD and larger rival Nvidia, limiting the chip companies’ ability to tap the order surge.
AMD CEO Lisa Su said that supplies of AI chips would be tight going into next year.
Revenue in its data centre business, which includes AI chips, surged 122 per cent to US$3.5 billion. AMD still trails front-runner Nvidia, which commands about 80 per cent of the AI semiconductor market. Su raised the forecast for AI chips, which are included in the data centre segment, by half a billion from the US$4.5 billion it estimated in July.
In the earnings call with analysts, Su also discussed Microsoft and Meta expanding their use of the company’s AI chips. Microsoft and Oracle offer the MI300X chips for rent as part of their cloud computing service. Analysts largely believe Nvidia will maintain its majority market share for the foreseeable future, owing in part to its entire AI ecosystem that includes the CUDA software and networking equipment.
