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Aug 5, 05:46 PM
Company Earnings
Stocks
AI Products
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AI

AMD Rally Faces Test as Quarterly Results Put AI Progress Under Scrutiny

Authors
  • First Squawk
  • Beth Kindig
  • Bloomberg Línea
5

Advanced Micro Devices is set to report second-quarter results after Tuesday’s close, with analysts expecting revenue to rise 27 percent from a year earlier to roughly $7.4 billion and adjusted earnings per share to fall 30 percent to $0.48. The figures will be parsed for evidence that the chipmaker is capitalising on the boom in artificial-intelligence computing. AMD shares have surged about 45–47 percent this year, eclipsing Nvidia’s 33 percent advance and making the company the best-performing name in the Philadelphia Semiconductor Index. The rally reflects investor bets that soaring capital expenditures on AI infrastructure—more than $340 billion collectively pledged by Meta Platforms, Microsoft, Amazon and Alphabet—will translate into stronger demand for AMD’s processors. The optimism faces a reality check. Nvidia still controls roughly 95 percent of revenue from AI graphics processors, leaving AMD with only 5 percent, according to Bloomberg Intelligence. Analysts say AMD must show progress in winning AI accelerator orders and sustaining market-share gains in central processors to justify its valuation, which now sits about 15 percent above the average price target and carries fewer buy ratings than its larger rival. A planned resumption of selected AI-chip shipments to China, cleared by U.S. regulators, could provide a near-term revenue lift, but most strategists argue that longer-term momentum hinges on AMD’s ability to broaden its AI portfolio in the face of entrenched competition from Nvidia.

Written with ChatGPT .

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