AMD’s Record Q1 Growth Fueled By 7nm Sales Yet Qualcomm Led In IC Revenue

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The outbreak of the coronavirus has had a mixed effect on business operations throughout the world. While some corporations, such as Apple, have undergone drastic reductions in key income statement metrics, others such as Zoom (NASDAQ:ZM), Advanced Micro Devices, Inc (NASDAQ:AMD) and NVIDIA Corporation (NASDAQ:NVDA) have witnessed a growth in either total revenues or segment-specific revenues that originate from products which have witnessed a growth in demand due to the shift in work and leisure conditions due to lockdowns that have either been imposed or are currently imposed all over the world.

Aiming to get a better understanding of how semiconductor designers performed during the first three months of the calendar year 2020, research firm Trendforce has compiled data from the world's leading chip companies and cross-referenced it with chip demand to determine the current state of affairs surrounding companies including NVIDIA, Qualcomm Incorporated (NASDAQ:QCOM) and AMD.

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The results show that in the first quarter of the calendar year 2020, Qualcomm's revenue growth was fuelled through the company's success in selling 5G smartphone chips to Chinese vendors, and AMD's success with 7nm products ensured that the x86 underdog witnessed spectacular year-over-year revenue growth during the same time period.

AMD, Qualcomm Helped By 7nm & 5G Chips Respectively For Revenue Growth During 1Q 2020 Reveals Analysis

TrendForce's analysis shows that Qualcomm's revenues from the chip designer's Qualcomm CDMA Technologies (QCT) arm responsible for selling products to vendors were dependant on Chinese demand for the company's 5G products and shifts in work and learning environments that forced users to carry both these tasks from home following the coronavirus outbreak. As per the details, Qualcomm has successfully infiltrated the 5G supply chain for Chinese smartphones, with the company Radio Front-end (RF) products enjoying widespread demand in the country.

Taking stock of the current working environment for Huawei following the American government's decision to tighten export control rules for semiconductors fabricated using U.S.-origin equipment, Qualcomm should see its popularity rise in China and other areas that traditionally use Huawei's products for smartphone chips. 5G components for handheld devices are generally fabricated on bleeding-edge nodes and if Huawei is denied access to products from Taiwan Semiconductor Manufacturing Corporations (TSMC)'s lines, then Qualcomm should see an even more favorable environment in China.

AMD's Ryzen 3950X (pictured above) is fabricated on TSMC's 7nm FinFET node, has a boost clock rate of 4.7GHz and retailed for $749. (Image Credit: AMD)

Moving towards AMD, TrendForce confirms earlier claims that the company's boost in revenue witnessed during the first calendar quarter was partly fuelled by the success of AMD's 7nm products. The Santa Clara chip manufacturer has continued to disrupt the x86 microprocessor market as it capitalizes on Intel Corporation's slow progress and shift of plans in the semiconductor arena.

During its earnings report for the first fiscal quarter of 2020, AMD also revealed that it had witnessed record notebook sales – a growth that came during a time period when the company's revenue dropped sequentially or quarter-over-quarter. However, despite the sequential drop which is natural given the passing of the holiday season, AMD's year-over-year revenue growth during the quarter was the highest of the top ten integrated circuit design companies that TrendForce included in its analysis.

Finally, NVIDIA's year-over-year revenue growth (39.6%) was aided by the company's graphics processing unit (GPU) sales for both gaming and datacenter products. Growth for the latter was expected as demand for high-performance computing rises in the wake of the coronavirus as researchers all over the world compile data and generate solutions and infrastructure corporations beef up their servers for the increased demand of online services.

Data compiled by TrendForce for the first quarter of the calendar year 2020. (Credit: TrendForce)
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