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Ryzen-Orange-Feature

AMD's Ryzen-fueled recovery handed the company its outset full-yr profits in years in 2017, and 2018 appears to be off to a very strong start. The visitor posted revenue of $1.65B for Q1 2018, up 1.4x from the same flow in 2017. According to AMD CEO Lisa Su, Ryzen processor shipments grew significantly, from a bit more xl percent of customer APU/CPU revenue in Q4 2017 to 60 percent in Q1 2018. This surge was undoubtedly helped past the launch of both Ryzen Mobile in very late Q4 and new Ryzen desktop APUs like the 2400G and 2200G in mid-Q1.

Hither's how Lisa Su summarized the GPU marketplace:

In Graphics, we delivered strong year-over-year revenue growth equally ASP and unit shipments increased significantly. On a sequential ground, revenue increased and we outperformed seasonality with stiff Radeon Vega and 500 serial channel sales, driven past both gaming and blockchain demand.

AMD also stated information technology'southward on rails to ramp Radeon Instinct MI25 for deep learning workloads, and still expects to deliver a 7nm die compress for its GPUs later in 2018. Apart from a very modest OEM rebrand effort around the 500-serial, AMD has not indicated that it intends to launch any new desktop cards this year, and it'southward non clear if such cards could significantly close the gap with the refreshed hardware Nvidia is expected to debut.

Server revenue grew past double-digits sequentially, though be aware that ramp is essentially starting from $0. While AMD has been slowly ramping Epyc into the server market place, these rollouts accept time. The visitor has previously stated it hopes to hold mid-single digit marketplace share in server past the stop of the year (we're estimating that at four-6 percent).

AMD'southward gross margins ticked upwardly to 36 percentage, in-line with the company's predictions and four percentage points higher than the 32 percent information technology recorded for Q1 2017. AMD expects its Q2 2018 earnings to be $1.725B, up i.5x from the same period in Q2 2017. While investors have repeatedly expressed fearfulness that AMD might suffer a striking if GPU sales into cryptocurrency mining calm down, AMD doesn't encounter itself as overly exposed. Devinder Kumar told investors that the visitor expects "Blockchain acquirement to be mid to loftier-unmarried-digit percentage of revenue for 2018." Reduced turn a profit in the EESC business was related to a ane-fourth dimension licensing proceeds that AMD recorded back in Q1 2017 rather than a meaning deviation in unit of measurement sales.

Now, we're not saying that 7-9 percent of AMD'due south yearly revenue is zilch. Fifty-fifty if we causeless AMD simply hit Q1 2018'due south sales figures iv times in a row, that'd piece of work out to equally much as $594M. But recollect, revenue isn't the same thing every bit profit, and AMD's margins on GPUs have historically been much smaller than its CPUs. Napkin-level math using our lowballed ($1.65B *iv) effigy with a 10 per centum internet profit margin suggests AMD might brand $60 meg in profit off crypto mining in 2018, assuming that demand for cards holds. Once more, that's by no means nothing, but it's non particularly large compared with Ryzen, either. With a second-generation Ryzen now in-marketplace, AMD looks to be well-positioned for 2018.