Wall Street Hits AMD Shares After Earnings Miss Expectations
The company also raised its full-year guidance, now forecasting revenue between $8.4 billion and $9 billion.
Quick overview
- AMD shares dropped over 5% in pre-market trading after quarterly results fell short of investor expectations.
- The company reported a revenue of $7.685 billion, exceeding analysts' expectations, but adjusted net income fell 31% from the previous quarter.
- An $800 million loss due to a U.S. government ban on chip sales to China contributed to an operating loss of $155 million.
- Despite the earnings miss, AMD executives expressed confidence in future growth and raised their full-year revenue guidance.
Advanced Micro Devices (AMD) shares fell over 5% in pre-market trading on Wall Street this Wednesday, following the release of quarterly financial results that failed to meet investor expectations.
Mixed Financial Results Weigh on AMD Stock
The chipmaker reported revenue of $7.685 billion, up 32% year-over-year and 3% quarter-over-quarter — 4% above analysts’ expectations. Revenue growth was driven by:
- Client and Gaming: up 69% YoY to $3.6 billion
- Data Centers: up 14% YoY to $3.2 billion
- Embedded Technology: down 4% YoY to $824 million
However, AMD posted an adjusted net income of $781 million, representing a 31% drop from Q2 2024 and a 50% decline from Q1. Adjusted earnings per share came in at $0.48, just below Wall Street’s forecast of $0.49.
The company also reported an $800 million hit due to a U.S. government ban — imposed by the Trump administration — preventing the sale of its MI308 AI chips to China. This resulted in an operating loss of $155 million for the quarter.
Executives Remain Confident in AMD’s Growth Outlook
Despite the earnings miss, AMD executives remained upbeat. “We delivered strong revenue growth in the second quarter, driven by record server and PC processor sales,” said Lisa Su, AMD’s Chair and CEO.
“We see robust demand across our computing and AI product portfolio and are well positioned for significant growth in the second half of the year, led by the launch of our AMD Instinct MI350 accelerators and continued market share gains for our EPYC and Ryzen processors,” she added.
The company also raised its full-year guidance, now forecasting revenue between $8.4 billion and $9 billion, ahead of the $8.3 billion average expected by Wall Street.
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