On Tuesday, Advanced Micro Devices AMD CEO Lisa Su said the company is focusing on keeping global customers tied to U.S. AI technologies amid new government rules.
What Happened: During AMD’s first-quarter earnings call, Su addressed questions about the company’s long-term outlook for AI chip sales.
Bank of America Securities analyst Vivek Arya asked Su how much of AMD’s nearly $500 billion total addressable market (TAM) for AI accelerators is linked to China, given increasing U.S. export restrictions.
He also pressed her on the potential impact of new U.S. government rules on the diffusion of AI technologies, which are set to take effect May 15.
In response, Su said the company had already accounted for China-related limits in its TAM estimates.
“We always expected that there would be some amount of what’s called limitation on sort of leading edge GPUs going into China,” Su said. “So that was factored into our TAM expectation when we talked about $500 billion. I don’t think that dramatically changes the TAM.”
However, Su underscored that the upcoming AI diffusion rules pose a more delicate challenge.
“We’re very actively working with the government as they’re thinking through these rules, and it’s a very fine balance that we have to have,” she said. Su stressed AMD’s commitment to making sure U.S. AI companies, including her own, remain the world’s primary technology platforms.
“We want to ensure that the rest of the world can really use us as the primary platform,” she stated.
Why It’s Important: Earlier, it was reported that the Donald Trump administration is considering a major revision to the Artificial Intelligence Diffusion, which divides countries into three tiers. Officials are now exploring a shift toward a global licensing system based on bilateral agreements.
They are also weighing stricter controls by lowering the exemption threshold for chip purchases. Currently, orders below the equivalent of 1,700 Nvidia Corporation NVDA H100 chips do not require an export license and only mandate a notification to authorities.
AMD posted first-quarter revenue of $7.44 billion, surpassing analyst expectations of $7.13 billion. Year-over-year, total revenue rose 36%.
For the second quarter, AMD projects revenue of around $7.4 billion, with a possible variance of $300 million. This outlook exceeds the current analyst forecast of $7.24 billion.
The company also expects a non-GAAP gross margin of 43% for the second quarter, factoring in an estimated $800 million in inventory-related charges tied to new export control regulations, as previously disclosed.
Price Action: AMD shares rose 1.72% in after-hours trading, reaching $100.32 at the time of writing, according to Benzinga Pro.
According to Benzinga Edge Stock Rankings, AMD holds a growth score in the 66th percentile. Curious how other chipmakers like Nvidia compare? Click here to view the full rankings.
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Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.
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