The doubling of sales happened not just with AMD’s EPYC server processors but also its Instinct data centre GPUs, which together made up roughly a quarter of the chipmaker’s record US$16.4 billion (A$22.97 billion) in revenue for last year was reported Tuesday in its fourth-quarter earnings results. That’s several points up from the data centre business unit’s share of total sales in 2020, which was just shy of 20 percent.
On the earnings call, Su said EPYC sales more than doubled in the fourth quarter from the same period last year, driven by cloud service providers expanding internal capacity and launching new instances as well as enterprise customers that are buying from an increasingly growing pool of EPYC-based servers.
Su said she expects 2022 to be “another year of significant growth” for the company’s server CPU business, noting that customers are “extremely” excited for the chipmaker’s next-generation EPYC processors, code-named Genoa, due out later this year.
While Intel has expressed confidence about its next-generation Xeon Scalable CPUs, code-named Sapphire Rapids, Su said believes that the chipmaker can grow “significantly faster than the market.”
“We continue to add more field support to have more people get familiar with our architecture. We have very strong OEM relationships. So I feel very good about our server trajectory,” she said.
The large uptick in EPYC revenue, along with record semi-custom sales driven by continued demand for AMD-powered video game consoles, allowed the chipmaker’s Enterprise, Embedded and Semi-Custom segment to grow 75 percent year-over-year to US$2.2 billion in the fourth quarter.
AMD’s data centre graphics revenue also more than doubled in the fourth quarter, which Su said was largely driven by high-performance computing customers buying the company’s Instinct MI200 data centre GPUs that were launched last fall.
Su said AMD’s focus for data centre GPUs this year is to expand into the cloud market and go beyond large HPC deployments. The latter area will be fueled by an increasing stable of OEMs and other partners that will launch servers with Instinct MI200 GPUs by March, which includes Atos, Dell, Hewlett Packard Enterprise, Lenovo and Supermicro.
“The hardware is very, very good. We’ve been investing more in the software. We’ve been working with our customers to ensure that our toolchain gets them the performance that they need. So I would say this is a longer-term driver, but I’m pleased with the progress that we made,” Su said.
AMD’s data centre graphics revenue helped the chipmaker’s Computing and Graphics segment grow 32 percent year-over-year to US$2.6 billion. However, the segment’s growth was largely driven by a double-digit percentage increase in client CPU sales, which, in turn, were led by notebook CPU sales.
“We saw strong demand for premium AMD notebooks and our higher-end desktop CPUs in the quarter as Ryzen 5000 processor unit shipments grew by a double-digit percentage sequentially,” she said. “As a result, we believe we gained client processor revenue share for the seventh straight quarter.”
The chipmaker’s two main segments allowed AMD to grow revenue by 49 percent year-over-year to US$4.8 billion in the fourth quarter of 2021. That allowed the company to beat Wall Street’s expectations by US$310 million, and it also surpassed analyst estimates by 16 cents with earnings per share of 92 cents for the quarter, which ended 25 December 2021.
Su said AMD’s supply issues caused the company to work “much more closely” with customers and supply chain partners. For the former group, this means getting visibility into customer forecasts “multiple quarters and, in some cases, multiple years out” for the kind of capacity they need.
As for supply chain partners, Su said, AMD has made “significant investments” in capacities for wafers, substrates and back-end resources. This is giving her the confidence that AMD will meet its guidance for 2022, for which the company expects to make roughly US$21.5 billion, a 31 percent increase from 2021.
“We feel very good about our progress in the supply chain to meet the 2022 guidance, and our goal is, frankly, to have enough supply to satisfy the demand out there,” she said.