Advanced Micro Devices (AMD) stock soared 6% in after-hours trading after the chipmaker reported Q1 earnings results. Adjusted earnings per share came in at $1.37, rose 42.7% year-over-year, and beat the consensus estimate of $1.29.
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In addition, revenue increased 38% year-over-year to $10.3 billion, driven by surging demand for high‑performance CPUs and accelerators powering AI workloads. The top line also beat analysts’ expectations of $9.90 billion.
CEO Dr. Lisa Su said the quarter marked a turning point for the company, aided by strong demand for AI infrastructure. Su added that customer interest in AMD’s MI450 Series accelerators and Helios platform is exceeding expectations, with a growing pipeline of large‑scale deployments providing increased visibility into future growth.
Data Center Leads the Charge
AMD’s Data Center segment delivered a standout quarter, with revenue climbing 57% year-over-year to $5.8 billion. The surge was fueled by strong demand for EPYC processors and continued ramp‑up of Instinct GPU shipments as hyperscalers expand AI infrastructure.
Other segments also contributed:
- Client and Gaming revenue: $3.6 billion, up 23% on strong Ryzen demand and Radeon GPU strength.
- Embedded revenue: $873 million, up 6% on improving demand across multiple end markets.
Overall, the Data Center segment remained the primary driver of the company’s revenue and earnings growth, consistent with recent quarters, as shown in the graph below.
Outlook: More AI‑Driven Growth Ahead
AMD expects the momentum to continue into Q2. The company guided for $11.2 billion in revenue, plus or minus $300 million, reflecting 46% year‑over‑year growth at the midpoint and a 9% sequential increase. Adjusted gross margin is expected to hold at 56%, compared with 55% in Q1.
Management said server growth should “accelerate meaningfully” as supply catches up with demand, driven by rising AI inferencing and agentic AI workloads that require more high‑performance compute.
Is AMD Stock a Buy, Hold, or Sell?
Currently, Wall Street has a Moderate Buy consensus rating on Advanced Micro Devices stock based on 17 Buys and nine Holds. Following a solid rally, the average AMD stock price target of $308.09 indicates 13% downside risk.
However, it’s worth noting that estimates will likely change following today’s earnings report.
