Intel, by contrast, has suffered a series of manufacturing setbacks, last week saying it has fallen behind in a new method for cutting-edge semiconductors and that it is considering scrapping a decades-old strategy of making chips in-house.

Shares of Taiwan’s TSMC soar after Intel’s apparent retreat in chip manufacturing

The admissions sparked a sell-off in Intel stock and underscored the ways Intel is being surpassed in chip production by TSMC, which in turn helps the Taiwanese company’s partners.

AMD chief executive Lisa Su said her bullish outlook is based on expectations that her company will keep adding share as new products gain wider adoption at computer makers. She said AMD has passed 10 per cent share of the profitable server chip market and that the company is confident it can meet increasing demand even though supply of leading-edge chips is “tight”.

AMD is also growing quickly in notebook computers, Su said. Demand for personal computers has not been hurt by the Covid-19 pandemic as much as the company initially feared, she said on a conference call with analysts.

“We delivered our highest client (personal computer) processor revenue in more than twelve years,” she said. “We believe our growth was largely driven by our eleventh straight quarter of market share gains.”

Demand for chips for notebooks and servers will increase in the second half, Su said.

Despite the optimism, Su reminded analysts that AMD is “in the early innings” of its journey to where it expects to be.

Intel’s announcement of further delays in improving its production does not change what AMD has to do, she said.

“The most important thing for us is to execute to our commitments to our customers,” she said. “Basically what we’re asking is for people to trust us with their most important workloads.”

Under Su, AMD has revamped its products and come surging back from what analysts had said was the brink of insolvency. Investors now want the company to justify its soaring valuation by growing to become more than just an afterthought to computer makers. The stock has almost doubled over the past year.

On Tuesday, AMD said it sees 2020 revenue rising about 32 per cent, driven by strength in personal computers, gaming and data centre products. Wall Street expects the company’s sales to climb 25 per cent this year to US$8.4 billion. Still, that is still about half what Intel books in one quarter.

AMD’s achievement of its more than 10 per cent interim server market target is also a long way from the more than 20 per cent the company achieved about 15 years ago. But it is up from less than 1 per cent before introducing new products in 2017.

Server computers are the backbone of corporate networks and the data centres that help run the internet. Server chips can sell for thousands of dollars each.

Nasdaq-listed AMD reported second-quarter net income of US$157 million, compared with US$35 million in the same period a year earlier. Revenue rose 26 per cent to US$1.93 billion.