AMD Stock Hits $240 on HSBC Downgrade After Record High – Earnings Preview

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Advanced Micro Devices pulled back after reaching record highs as a downgrade, rising expectations, and upcoming earnings increased investor caution.

Record High Followed by Sharp Pullback

AMD recently climbed to an all-time high, supported by strong sector momentum and optimism around AI-driven demand. However, the rally quickly lost traction as the stock fell around 5% on Monday.

The decline followed a downgrade from HSBC, which cut its rating to “hold” from “buy,” warning that AMD may struggle to exceed already elevated expectations. Although the price target was raised slightly to $340, it still implied downside from recent levels near $360, a move that largely played out as shares dropped toward that range.

Intel Results Highlight Strong Demand

Despite the pullback, broader industry signals remain supportive. Strong earnings from Intel Corporation pointed to robust demand in data center and AI-related processors.

For AMD, this is viewed less as a competitive threat and more as confirmation of underlying market strength. Its EPYC server chips compete in the same space, meaning continued demand growth benefits multiple players across the sector.

Earnings Now a Critical Test

AMD is set to report Q1 2026 results, with analysts expecting revenue of roughly $9.8–$9.9 billion and earnings per share between $1.24 and $1.30.

Investor attention will center on data center performance, AI-related product demand, and forward guidance. With expectations already high, the results will need to be strong across multiple areas to sustain the stock’s elevated valuation.

Share Price Reacts Swiftly

Following the earnings release, AMD shares fell sharply, sliding roughly 20% in January and pushing the stock below the $200 level. But the 100 SMA (red) acted as support on the daily chart. The price moved above and below $200 many times so the market was trying to decide which way to go, but decided on the upside in late March, breaking above the 50 daily SMA (yellow) and reaching a new record high of $353 late last week. The stock has reversed on Monday but AMD held above $300 nonetheless and rebounded strongly for three days reaching a new record.

AMD Chart Daily – Rebounding Off the 100 SMA

AI Narrative Faces Short-Term Pressure

While long-term growth tied to advanced computing remains intact, near-term sentiment is becoming more cautious. Weakness across semiconductor peers, including Broadcom Inc., suggests investors are reassessing how quickly demand will expand.

As workloads diversify beyond GPUs into CPUs and other architectures, growth may become more gradual, challenging assumptions of rapid expansion.

Valuation and Spending Concerns

AMD’s strong rally has pushed valuations higher, leaving limited room for disappointment. Even minor misses in earnings or guidance could trigger outsized market reactions.

At the same time, questions are emerging around the pace of large-scale infrastructure spending tied to companies like OpenAI. While long-term investment plans remain substantial, rising costs and tighter budgets are creating uncertainty about how quickly demand will materialize.

Conclusion

AMD’s long-term growth story remains supported by strong demand for high-performance computing and AI infrastructure. However, the combination of elevated expectations, valuation pressure, and near-term uncertainty creates a more fragile setup.

With earnings approaching, the stock faces a critical test where strong execution will be required to justify recent gains and sustain momentum.

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Skerdian Meta

Lead Analyst

Skerdian Meta Lead Analyst. Skerdian is a professional Forex trader and a market analyst. He has been actively engaged in market analysis for the past 11 years. Before becoming our head analyst, Skerdian served as a trader and market analyst in Saxo Bank's local branch, Aksioner. Skerdian specialized in experimenting with developing models and hands-on trading. Skerdian has a masters degree in finance and investment.

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