Data Center revenue doubled and operating income tripled, yet gross margins stuck at 54% tell you exactly who owns the leverage in this supply chain.
Thesis: The CPU business is now a rounding error. This is a pure-play option on AI infrastructure capacity. While TSMC and HBM providers are eating the gross margin upside (flat at 54%), the operating leverage is undeniable: DC operating income tripled on doubled revenue. With NVDA sold out, AMD is the only bucket for spillover capital. You buy the spillover.
Verdict: LONG — Conviction: HIGH
Catalyst: MI325X production shipments starting Q4 2024 and widespread system availability Q1 2025.
Key Risk: Customer concentration. 'These are large customers that drive deployments' creates binary quarter-to-quarter volatility risk.
The Tell: When asked about seasonality, Su admitted: 'It depends quite a bit on a specific number of customers... these are large customers that drive deployments.' She walked back the seasonality comment to highlight extreme concentration risk.
Friction Level: MODERATE_FRICTION — Bulls see a second source for AI compute; Bears see a margin-dilutive ramp dependent on 6 customers.
Report not found
The report data is no longer available. Please return to the archive.