TMTPOST --   It seems still hard   for Advanced Micro Devices Inc.   to tell   the recovery trend of   sales in   China, even though   the U.S. artificial intelligence   ( AI )   chip   titan expects   the Trump administration to   greenlight   exports   of   its   chips tailored to the   market and   issued   upbeat revenue outlook   for the current quarter.

Credit：AMD

AMD on Tuesday posted mixed results   for   the   second quarter   of this   year. Revenue rose 32% year-over-year ( YoY )   to a new   record of $7.69 billion, topping   analysts   estimated   $7.43   billion. Diluted   earnings   per   share ( EPS )   under   non-GAAP basis was   $0.48, just shy   of   Wall   Street   expectation of $0.49.   That   represented a   30%   YoY decline   in EPS   after a   55% YoY increase   three months ago.   Operating income fell   29% YoY to $897 million, missing   estimated $902.8   million   after   a 57% YoY   surge for the previous quarter.

AMD ’ s   bottom   line was hit by the   U.S. government ’ s   tightening control   on   AI   chip   exports to China. The   company in April disclosed the Trump administration effectively banned it   from selling its MI308   chips to Chinese customers, which the company said led to inventory and related charges of approximately $800 million for the quarter   ended in   June.

AMD reported on Tuesday that adjusted gross margins   on   non-   GAAP   basis   shed 10 percentage points   YoY to   43% for the June quarter   due   to the export restrictions. Excluding the charge, adjusted gross margins would've been 54%, in   line with the preceding two quarters, AMD estimated   in April.

AMD   CEO   Lisa   Su said her company delivered strong revenue growth in the second quarter led by record server and PC processor sales.   Though   AMD ’ s top   segment Data   Center was also   dragged   by the export control. Revenue from   the segment gained 14% YoY to $3.2 billion   following   a   57% YoY rise for from January   to March. The growth was driven by    strong demand for AMD EPYC processors, which more than offset   "headwinds impacting AMD Instinct MI308 shipments to China."

Looking   forward the third quarter, AMD saw   top line   to maintain double-digit growth   but declined to give   forecast   of MI308 sales   in   China. It   projected revenue for from July to   September   to be around   between $8.4   billion   to $9.0   billion, setting the new quarterly record.   At the mid-point   of   the revenue range, this   represents YoY growth of approximately   28% and sequential   growth   of about 13%.   Non-GAAP gross margin   is   anticipated to be around 54%, up from 43%   for the June quarter.

But AMD noted the aforementioned guidance didn ’ t reflect   any MI308 sales.   "Our current outlook does not include any revenue from AMD Instinct MI308 shipments to China as our license applications are currently under review by the U.S. Government,"   said the company in a statement.

The guidance   indicated AMD still   can   not   determine   how   soon   MI308 sales would recover   once   the Trump administration granted export   license for the chips.   AMD at mid-July said it   received Washington ’ s assurances from the U.S.   Commerce Department and plans to restart shipments of its MI308 chips to China once licenses for sales are approved.

"We appreciate the focus the Trump administration is placing on ensuring that US technology remains central to global AI infrastructure and we expect to resume MI308 shipments as licenses are approved, subject to end customer demand and supply chain readiness," AMD CEO Su on Tuesday said on a conference call with analysts. "As our licenses are still under review, we are not including any MI308 revenue in our third-quarter guidance."

Despite the uncertain   MI308 sales, Su   expressed   optimistic on overall   revenue for remaining   two quarters of this year. "We are seeing robust demand across our computing and AI product portfolio and are well positioned to deliver significant growth in the second half of the year, driven by the ramp of our AMD Instinct MI350 series accelerators and ongoing EPYC and Ryzen processor share gains,"   said Su in a statement.

On the earnings call, Su told analysts   that MI355, the latest   chips   AMD released in June,   started production in June and is shipping, and that AMD is seeing "really positive" demand from customers. "We're bullish on MI355 and where the AI opportunity is for us," Su said.  

AMD expects   the MI355   chips are going   to ramp   very quickly   since they will be attractive to customers,   according to Su. She said   MI400 series   of accelerators, which are set to   roll   out   next year, are also seeing positive feedback from customers.