Chipmaker Advanced Micro Devices (AMD) recently reported its results for the second quarter of 2025, which failed to live up to investors’ expectations. While AMD’s Q2 revenue surpassed the Street’s estimates, its earnings were in line with expectations, with investors concerned about the decline in artificial intelligence (AI) business revenue. Many analysts maintained their bullish stance on AMD stock after the Q2 print. However, some analysts expressed concerns about AMD’s AI/data center revenue and higher expenses. In fact, Wall Street’s average price target indicates a limited upside potential from current levels. AMD stock has rallied 43% so far this year.
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Heading into Q2 results, the hype around AMD’s AI business was very high, especially after the Advancing AI event. AMD highlighted its new GPUs (graphics processing units), which revived investors’ hopes about the company’s prospects after persistent concerns about it lagging behind rival Nvidia (NVDA) in the AI race. However, AMD’s Q2 results, especially the data center business growth and AI business revenue decline, disappointed investors. AMD cited U.S. export restrictions that eliminated MI308 sales to China and the transition to its next-generation chips as the reasons for the decline in Q2 AI business revenue.
AMD’s Q2 Results Draw Some Concerns
Despite the mixed Q2 results, AMD bulls are confident about the company’s potential to grow in both CPU and GPU markets and capture AI opportunities. However, some analysts remain cautious due to the ongoing challenges.
For instance, Goldman Sachs analyst James Schneider raised his price target for AMD stock to $150 from $140, but reiterated a Hold rating. The 4-star analyst noted that AMD is seeing strong traction with its Data Center GPU solutions. In particular, Schneider expects the MI355 offering to drive strong double-digit quarter-over-quarter growth in the Data Center segment in the third quarter and continued sequential growth in Q4 2025.
While Schneider remains constructive on AMD’s ability to drive significant market share gains in the PC and enterprise server markets in the near term, he retains a neutral stance on the stock as he is “more guarded” on the company’s ability to drive scale in Data Center GPUs over time. Also, he thinks that AMD’s earnings power is likely to be hampered by the significant operating expenses ramp needed to support its AI software and systems efforts.
Meanwhile, Morgan Stanley analyst Joseph Moore lowered his price target for AMD stock to $168 from $185 and maintained a Hold rating. The 5-star analyst stated that the quarter was solid across segments and revenue continues to be “quite strong, but it’s not clear that will be enough to keep the bulls in charge of the narrative.” He contends that AMD’s commentary on the timing of resumption of China shipments was “more vague than expected.” Overall, Moore slashed his price target for AMD stock to reflect lower conviction in China demand and a lack of AI-related upside.
Is AMD Stock a Buy or Sell Now?
Overall, Wall Street is cautiously optimistic on Advanced Micro Devices stock, with a Moderate Buy consensus rating based on 25 Buys and 12 Holds. The average AMD stock price target of $180.78 indicates 4.6% upside potential from current levels.
