Advanced Micro Devices (NASDAQ:AMD) Announces Quarterly Earnings Results, Beats Estimates By $0.14 EPS

Advanced Micro Devices (NASDAQ:AMD) released its earnings results on Tuesday. The semiconductor manufacturer reported $2.09 earnings per share (EPS) for the quarter, beating analysts’ consensus estimates of $1.95 by $0.14, FiscalAI reports. The company had revenue of $13.38 billion for the quarter, compared to the consensus estimate of $13.10 billion. Advanced Micro Devices had a net margin of 15.58% and a return on equity of 12.30%. The company’s revenue was up 44.7% compared to the same quarter last year. During the same period in the prior year, the company posted $1.20 EPS.

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

• Record third-quarter results: Revenue rose 45% year over year to $13.4 billion, while non-GAAP EPS increased 74% to $2.09. Data center revenue nearly doubled to $8.5 billion, lifting operating margin to 29%.
• AMD raised its outlook for 2027, expecting total revenue to grow more than 80%, server revenue to double, and data center to contribute over 80% of company revenue. The company cited strong demand for EPYC Venice CPUs, Instinct GPUs, and Helios rack-scale systems.
• Helios and MI450 deployments are ramping, with major cloud providers and AI customers bringing systems online. Management said data center AI revenue will surpass server revenue in the fourth quarter and that demand currently exceeds available supply.
• Embedded revenue increased 29% year over year to $1.1 billion, marking a fourth consecutive quarter of accelerating growth. AMD also expects operating leverage to continue, with 2027 operating-expense growth below half of expected revenue growth.
• Client and gaming revenue declined 8% year over year, including a 40% drop in gaming from lower semi-custom console sales. AMD expects the PC market to decline by a double-digit percentage in 2027, while higher memory and component costs are already weakening demand.

Advanced Micro Devices Stock Performance

Shares of NASDAQ:AMD opened at $483.90 on Wednesday. The company has a debt-to-equity ratio of 0.03, a current ratio of 2.61 and a quick ratio of 1.91. Advanced Micro Devices has a 1 year low of $188.22 and a 1 year high of $658.52. The stock has a market capitalization of $789.95 billion, a price-to-earnings ratio of 124.40, a price-to-earnings-growth ratio of 4.79 and a beta of 2.49. The company’s 50 day simple moving average is $548.70 and its 200 day simple moving average is $411.73.

Analyst Upgrades and Downgrades

Several research firms have weighed in on AMD. Bank of America reissued a “buy” rating on shares of Advanced Micro Devices in a research note on Wednesday. Sanford C. Bernstein reiterated an “outperform” rating on shares of Advanced Micro Devices in a report on Wednesday. Zacks Research cut shares of Advanced Micro Devices from a “strong-buy” rating to a “hold” rating in a report on Tuesday, September 1st. Raymond James Financial restated a “strong-buy” rating and issued a $649.00 price target on shares of Advanced Micro Devices in a research note on Wednesday. Finally, Cantor Fitzgerald reiterated an “overweight” rating on shares of Advanced Micro Devices in a research note on Monday, October 5th. Three investment analysts have rated the stock with a Strong Buy rating, thirty-one have assigned a Buy rating, eight have assigned a Hold rating and one has given a Sell rating to the company. According to data from MarketBeat.com, the stock currently has a consensus rating of “Moderate Buy” and an average price target of $608.35.

Key Advanced Micro Devices News

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

• Positive Sentiment: Quarterly results beat expectations. AMD reported fiscal Q3 adjusted EPS of $2.09 and revenue of $13.38 billion, ahead of analyst forecasts. Data-center revenue rose 97% year over year to $8.55 billion, powered by record sales of Instinct GPUs and EPYC CPUs. Reuters report
• Positive Sentiment: Outlook reinforces the AI growth story. Management forecast about $17 billion in Q4 revenue, above expectations, and expects AI data-center revenue to more than double in 2027. The outlook helped ease concerns about whether AI-chip spending can sustain its pace. Benzinga report
• Positive Sentiment: Analyst support adds to investor confidence. TD Cowen called AMD a top pick, citing strong AI momentum after the results, while Wedbush reiterated an Outperform rating and a $600 price target. TipRanks report
• Neutral Sentiment: Broader U.S. futures also rebounded in morning trading, providing a supportive market backdrop, though this move was not specific to AMD. Barchart report
• Negative Sentiment: Execution and valuation risks remain. The Q4 adjusted gross-margin outlook of 55% was slightly below analyst expectations, and AMD faces tight supplies of high-bandwidth memory needed for AI processors. Commentary also flagged rising inventory and weaker free cash flow as potential costs of the rapid expansion; AMD’s high valuation leaves less room for execution misses. Economic Times report

Insider Buying and Selling at Advanced Micro Devices

In related news, EVP Forrest Norrod sold 17,262 shares of the company’s stock in a transaction that occurred on Thursday, October 15th. The shares were sold at an average price of $540.70, for a total transaction of $9,333,563.40. Following the completion of the transaction, the executive vice president directly owned 353,317 shares in the company, valued at $191,038,501.90. This represents a 4.66% decrease in their position. The transaction was disclosed in a document filed with the Securities & Exchange Commission, which is available through this hyperlink. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, EVP Jean X. Hu sold 15,000 shares of the firm’s stock in a transaction on Tuesday, August 25th. The shares were sold at an average price of $474.08, for a total value of $7,111,200.00. Following the sale, the executive vice president directly owned 160,979 shares in the company, valued at approximately $76,316,924.32. This trade represents a 8.52% decrease in their position. The SEC filing for this sale provides additional information. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Insiders sold 231,100 shares of company stock worth $114,867,400 over the last 90 days. 0.50% of the stock is owned by corporate insiders.

About Advanced Micro Devices

Advanced Micro Devices, Inc (NASDAQ: AMD) is a global semiconductor company that designs high-performance computing, graphics and adaptive computing products. Its offerings serve data centers, personal computers, gaming systems, embedded markets and other specialized applications.

AMD’s product portfolio includes Ryzen processors for desktop and notebook computers, EPYC server processors, Radeon graphics processing units, and Instinct accelerators for artificial intelligence and high-performance computing.