Why Did AMD Stock Fall After Record Revenue? The Bar Has Changed
TLDR
- AMD reported record Q2 revenue of $11.54 billion, up 50% year-over-year, beating Wall Street expectations
- Adjusted EPS came in at $1.66, topping the $1.62 estimate
- Data center revenue more than doubled to $6.7 billion, now representing 58% of total revenue
- AMD stock fell around 5-8.5% despite the beat, as investors wanted a bigger blowout quarter
- Q3 guidance of ~$13 billion topped some estimates but fell short of the highest forecasts of up to $14 billion
AMD beat Wall Street on revenue and earnings, raised guidance, and watched its stock drop anyway. That about sums up where the bar is right now for AI chip stocks.
Advanced Micro Devices, Inc., AMD
The chipmaker posted Q2 revenue of $11.54 billion, up 50% from $7.69 billion a year ago. Adjusted earnings per share came in at $1.66, ahead of the $1.62 analysts had penciled in. By any traditional measure, it was a strong quarter.
Yet AMD stock fell roughly 5% on Wednesday following the results.
“It was priced for something much closer to a blowout,” said Shay Boloor, Futurum chief market strategist. “It was priced for an exceptional result, and this was not an exceptional result.”
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