Advanced Micro Devices (NASDAQ:AMD) Posts Quarterly Earnings Results, Beats Expectations By $0.05 EPS

Key Points

• AMD beat quarterly expectations: Adjusted EPS was $1.66 versus the $1.61 consensus, while revenue reached $11.54 billion, up 50.1% year over year and ahead of estimates.
• Data center and AI demand drove growth: Data-center revenue more than doubled to a record $6.7 billion, and AMD raised its outlook for server CPUs, Helios rack-scale systems and next-generation AI accelerators.
• Management issued strong guidance but flagged risks: Third-quarter revenue is expected at $12.7 billion-$13.3 billion, above analyst expectations, though a softer PC market, declining gaming revenue, tight server supply and AMD’s high valuation could weigh on shares.

Advanced Micro Devices (NASDAQ:AMD - Get Free Report) released its quarterly earnings data on Tuesday. The semiconductor manufacturer reported $1.66 EPS for the quarter, beating analysts' consensus estimates of $1.61 by $0.05, FiscalAI reports. The firm had revenue of $11.54 billion for the quarter, compared to analysts' expectations of $11.31 billion. Advanced Micro Devices had a return on equity of 9.55% and a net margin of 13.37%.The firm's quarterly revenue was up 50.1% on a year-over-year basis. During the same period in the prior year, the firm posted $0.48 earnings per share.

Here are the key takeaways from Advanced Micro Devices' conference call:

• Record Q2 results: Revenue rose 50% year over year to $11.5 billion, while gross margin expanded to 56% and comparable diluted EPS increased approximately 82%. Data center revenue more than doubled to $6.7 billion and represented 58% of total revenue.
• AMD raised its growth expectations for its data center business, forecasting server CPU revenue growth of more than 80% year over year in the second half of 2026 and more than 70% in 2027. The company expects total data center revenue to more than double in 2027, supported by strong EPYC demand and new Venice processors.
• The AI opportunity is expanding rapidly, with AMD estimating a data center accelerator market of approximately $1.4 trillion by 2030. Helios rack-scale systems using MI450 GPUs are in production, initial shipments are expected this quarter, and announced deployments with OpenAI, Meta, Anthropic, and Microsoft provide significant potential for 2027 growth.
• Management said customer demand for Helios and the next-generation MI500 platform is ahead of initial expectations, while ROCm software adoption and ecosystem contributions continue to grow. AMD now expects overall revenue growth to substantially exceed its prior target of more than 35% and expects to significantly surpass its $20 strategic EPS target.
• AMD expects a softer PC market in the second half as higher memory and component costs pressure demand, while gaming revenue fell 31% year over year because of lower semi-custom console sales and weaker graphics demand. The server CPU supply chain also remains tight, although management expects conditions to improve in 2027.

Advanced Micro Devices Trading Up 7.0%

NASDAQ AMD traded up $33.94 during trading on Tuesday, hitting $518.58. The stock had a trading volume of 46,770,442 shares, compared to its average volume of 27,587,436. The company has a market capitalization of $845.60 billion, a PE ratio of 170.03 and a beta of 2.48. The company has a quick ratio of 1.96, a current ratio of 2.72 and a debt-to-equity ratio of 0.04. The firm has a 50 day moving average price of $516.06 and a 200 day moving average price of $354.63. Advanced Micro Devices has a twelve month low of $149.22 and a twelve month high of $584.73.

Key Advanced Micro Devices News

Here are the key news stories impacting Advanced Micro Devices this week:

• Positive Sentiment: AMD reported second-quarter adjusted EPS of $1.66, ahead of the $1.61 consensus estimate, while revenue rose 50.1% year over year to $11.54 billion, exceeding the $11.31 billion forecast. AMD Surpasses Q2 Earnings and Revenue Estimates
• Positive Sentiment: Data-center revenue reportedly more than doubled to a record $6.7 billion, reinforcing the AI-infrastructure growth story and AMD’s efforts to compete with Nvidia in GPUs, CPUs and rack-scale systems. AMD Revenue Climbs 50% and Data Center Sales Doubled
• Positive Sentiment: Third-quarter revenue guidance of $12.7 billion to $13.3 billion exceeded the approximately $12.4 billion analyst consensus, indicating continued demand for AI and data-center products. AMD Forecasts Upbeat Revenue on AI Data-Center Demand
• Neutral Sentiment: A broad risk-on rally lifted the semiconductor sector, with gains in Nvidia, Intel, Broadcom and Marvell providing a favorable backdrop for AMD before earnings. Chip Stocks Ride a Risk-On Rally
• Negative Sentiment: Investors viewed the quarterly beat as modest relative to AMD’s rally and valuation—roughly 170 times trailing earnings in the supplied data—raising concerns that expectations had already priced in exceptional execution. AMD Reported Record Sales but Stock Fell
• Negative Sentiment: Commentary also highlighted potentially “shocking” capital spending and continuing insider selling; data supplied by Quiver shows 99 insider sales and no purchases over the past six months. These signals may have amplified profit-taking after the release. AMD Stock Falls on Q2 Earnings

Analyst Ratings Changes

AMD has been the topic of several recent analyst reports. Cantor Fitzgerald reaffirmed an "overweight" rating and issued a $700.00 price target on shares of Advanced Micro Devices in a research note on Friday, July 24th. JPMorgan Chase & Co. raised their price objective on Advanced Micro Devices from $270.00 to $385.00 and gave the stock a "neutral" rating in a research report on Wednesday, May 6th. Weiss Ratings raised shares of Advanced Micro Devices from a "hold (c)" rating to a "hold (c+)" rating in a research report on Wednesday, May 6th. Wall Street Zen upgraded shares of Advanced Micro Devices from a "hold" rating to a "buy" rating in a research report on Monday, July 20th. Finally, Melius Research set a $660.00 price objective on shares of Advanced Micro Devices in a report on Friday, July 24th. Two analysts have rated the stock with a Strong Buy rating, thirty have assigned a Buy rating, eleven have assigned a Hold rating and one has assigned a Sell rating to the stock. According to data from MarketBeat.com, the stock has an average rating of "Moderate Buy" and an average price target of $529.46.

Insider Buying and Selling at Advanced Micro Devices

In related news, EVP Forrest Eugene Norrod sold 19,487 shares of Advanced Micro Devices stock in a transaction that occurred on Wednesday, May 20th. The shares were sold at an average price of $431.40, for a total value of $8,406,691.80. Following the completion of the transaction, the executive vice president owned 324,527 shares in the company, valued at approximately $140,000,947.80. The trade was a 5.66% decrease in their ownership of the stock. The sale was disclosed in a document filed with the SEC, which is accessible through this hyperlink. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, EVP Mark D. Papermaster sold 6,000 shares of the company's stock in a transaction that occurred on Monday, June 15th. The stock was sold at an average price of $536.33, for a total transaction of $3,217,980.00. Following the sale, the executive vice president directly owned 1,233,687 shares in the company, valued at approximately $661,663,348.71. The trade was a 0.48% decrease in their ownership of the stock. The SEC filing for this sale provides additional information. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. In the last three months, insiders have sold 310,310 shares of company stock valued at $141,185,456. Corporate insiders own 0.50% of the company's stock.

Institutional Trading of Advanced Micro Devices

Several hedge funds have recently modified their holdings of the stock. State Street Corp increased its holdings in Advanced Micro Devices by 1.5% during the 4th quarter. State Street Corp now owns 74,919,276 shares of the semiconductor manufacturer's stock worth $16,044,712,000 after purchasing an additional 1,094,835 shares during the period. Price T Rowe Associates Inc. MD boosted its stake in shares of Advanced Micro Devices by 0.3% in the 4th quarter. Price T Rowe Associates Inc. MD now owns 20,325,288 shares of the semiconductor manufacturer's stock valued at $4,352,864,000 after buying an additional 55,969 shares during the period. Amundi grew its position in shares of Advanced Micro Devices by 17.4% during the fourth quarter. Amundi now owns 15,828,895 shares of the semiconductor manufacturer's stock worth $3,389,916,000 after buying an additional 2,342,668 shares in the last quarter. Charles Schwab Investment Management Inc. grew its position in shares of Advanced Micro Devices by 2.6% during the fourth quarter. Charles Schwab Investment Management Inc. now owns 11,598,021 shares of the semiconductor manufacturer's stock worth $2,483,832,000 after buying an additional 292,555 shares in the last quarter. Finally, Rafferty Asset Management LLC increased its stake in shares of Advanced Micro Devices by 56.0% during the second quarter. Rafferty Asset Management LLC now owns 6,772,923 shares of the semiconductor manufacturer's stock worth $961,078,000 after buying an additional 2,430,533 shares during the period. 71.34% of the stock is currently owned by institutional investors and hedge funds.

About Advanced Micro Devices

Advanced Micro Devices, Inc NASDAQ: AMD is a global semiconductor company that designs and sells microprocessors, graphics processors, chipsets and adaptive computing solutions for a broad set of markets. The company's product portfolio includes consumer and commercial CPUs under the Ryzen and Threadripper brands, data center processors under the EPYC brand, and Radeon graphics processing units for gaming and professional visualization. AMD also offers semi-custom system-on-chip (SoC) products for gaming consoles and other specialized applications, and provides supporting software and platform technologies for OEMs, cloud service providers and end users.

Founded in 1969, AMD has evolved from a supplier of logic chips into a diversified, fabless semiconductor designer.

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