Advanced Micro Devices (NASDAQ:AMD) Shares Down 7% – What’s Next?

Advanced Micro Devices, Inc. (NASDAQ:AMD)’s stock price traded down 7% on Wednesday . The stock traded as low as $478.20 and last traded at $482.05. 48,585,476 shares were traded during mid-day trading, an increase of 34% from the average session volume of 36,278,320 shares. The stock had previously closed at $518.58.

Key Stories Impacting Advanced Micro Devices

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

• Positive Sentiment: AMD agreed to acquire Toronto-based Taalas, a specialist in customized AI inference silicon. Integrating Taalas’ technology with AMD Instinct GPUs could improve inference speed and efficiency, strengthening AMD’s ability to compete with Nvidia in a rapidly expanding market. The purchase price was not disclosed. AMD deepens AI inference bet with Taalas deal
• Positive Sentiment: AMD’s second-quarter results exceeded estimates: revenue rose 50.1% year over year to $11.54 billion and EPS reached $1.66 versus a $1.62 consensus forecast. Data Center revenue more than doubled, while management provided a strong outlook, including approximately 41% expected growth. Several analysts remained bullish, with Rosenblatt raising its price target to $700 and JPMorgan lifting its target to $550, though JPMorgan retained a neutral rating. AMD Q2 earnings beat estimates
• Neutral Sentiment: Institutional filings showed PNC Financial and GF Fund Management increased their AMD holdings by roughly $166 million and $168 million, respectively, as of June 30. These purchases indicate institutional confidence but are lagging disclosures rather than a direct near-term catalyst.
• Negative Sentiment: The earnings reaction reflects a very high bar for AI growth. Investors were disappointed by the outlook’s perceived conservatism, near-term weakness in PC/client and gaming businesses, and uncertainty about margins and AMD’s ability to take meaningful share from Nvidia. With AMD trading at a premium valuation, strong execution was not enough to satisfy expectations. AMD drops after Q2 earnings

Analysts Set New Price Targets

Several research analysts have commented on AMD shares. William Blair restated a “market perform” rating on shares of Advanced Micro Devices in a research report on Friday, July 24th. Evercore reaffirmed an “outperform” rating and set a $579.00 price target on shares of Advanced Micro Devices in a report on Tuesday, May 19th. Zacks Research upgraded Advanced Micro Devices from a “hold” rating to a “strong-buy” rating in a research report on Monday. UBS Group reissued an “overweight” rating on shares of Advanced Micro Devices in a report on Friday, July 24th. Finally, Jefferies Financial Group set a $650.00 target price on Advanced Micro Devices in a research note on Wednesday. Three investment analysts have rated the stock with a Strong Buy rating, thirty-one have given a Buy rating, ten have assigned a Hold rating and one has assigned a Sell rating to the company’s stock. According to data from MarketBeat, the stock currently has a consensus rating of “Moderate Buy” and an average price target of $546.87.

Advanced Micro Devices Trading Down 1.2%

The stock has a market capitalization of $788.17 billion, a P/E ratio of 124.26 and a beta of 2.48. The business has a 50 day simple moving average of $515.22 and a 200-day simple moving average of $358.23. The company has a debt-to-equity ratio of 0.03, a quick ratio of 1.96 and a current ratio of 2.61.

Advanced Micro Devices (NASDAQ:AMD) last posted its quarterly earnings data on Tuesday, August 4th. The semiconductor manufacturer reported $1.66 EPS for the quarter, topping analysts’ consensus estimates of $1.62 by $0.04. The company had revenue of $11.54 billion for the quarter, compared to the consensus estimate of $11.31 billion. Advanced Micro Devices had a return on equity of 12.30% and a net margin of 15.58%.The company’s quarterly revenue was up 50.1% compared to the same quarter last year. During the same quarter in the previous year, the business earned $0.48 EPS. On average, analysts predict that Advanced Micro Devices, Inc. will post 6.34 EPS for the current year.

Insider Buying and Selling at Advanced Micro Devices

In other news, CEO Lisa T. Su sold 125,000 shares of Advanced Micro Devices stock in a transaction that occurred on Wednesday, June 10th. The shares were sold at an average price of $460.69, for a total value of $57,586,250.00. Following the transaction, the chief executive officer owned 2,896,899 shares of the company’s stock, valued at $1,334,572,400.31. The trade was a 4.14% decrease in their position. The sale was disclosed in a document filed with the SEC, which is accessible through this link. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, EVP Forrest Eugene Norrod sold 19,487 shares of the business’s stock in a transaction that occurred on Wednesday, May 20th. The stock was sold at an average price of $431.40, for a total transaction of $8,406,691.80. Following the completion of the sale, the executive vice president owned 324,527 shares in the company, valued at $140,000,947.80. The trade was a 5.66% decrease in their ownership of the stock. Additional details regarding this sale are available in the official SEC disclosure. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Insiders have sold a total of 285,934 shares of company stock valued at $130,353,006 in the last ninety days. 0.50% of the stock is owned by insiders.

Institutional Inflows and Outflows

Several hedge funds have recently added to or reduced their stakes in the business. Southpoint Capital Advisors LP grew its stake in shares of Advanced Micro Devices by 50.0% in the first quarter. Southpoint Capital Advisors LP now owns 900,000 shares of the semiconductor manufacturer’s stock valued at $183,087,000 after buying an additional 300,000 shares in the last quarter. Jefferies Financial Group Inc. lifted its stake in Advanced Micro Devices by 6,228.8% in the fourth quarter. Jefferies Financial Group Inc. now owns 308,021 shares of the semiconductor manufacturer’s stock valued at $65,966,000 after acquiring an additional 303,154 shares during the last quarter. Boomfish Wealth Group LLC bought a new position in shares of Advanced Micro Devices in the 1st quarter valued at about $1,193,000. Dimensional Fund Advisors LP increased its stake in shares of Advanced Micro Devices by 6.0% during the 1st quarter. Dimensional Fund Advisors LP now owns 5,142,516 shares of the semiconductor manufacturer’s stock worth $1,045,954,000 after purchasing an additional 291,165 shares during the last quarter. Finally, Williamson Legacy Group LLC acquired a new position in shares of Advanced Micro Devices during the 4th quarter worth about $1,118,000. Institutional investors and hedge funds own 71.34% of the company’s stock.

Advanced Micro Devices Company Profile

Advanced Micro Devices, Inc (NASDAQ: AMD) is a global semiconductor company that designs and sells microprocessors, graphics processors, chipsets and adaptive computing solutions for a broad set of markets. The company’s product portfolio includes consumer and commercial CPUs under the Ryzen and Threadripper brands, data center processors under the EPYC brand, and Radeon graphics processing units for gaming and professional visualization. AMD also offers semi-custom system-on-chip (SoC) products for gaming consoles and other specialized applications, and provides supporting software and platform technologies for OEMs, cloud service providers and end users.

Founded in 1969, AMD has evolved from a supplier of logic chips into a diversified, fabless semiconductor designer.