Advanced Micro Devices (AMD) AI Stock Analysis

• Market Cap: $184.05B
• Dividend Yield: N/A
• Average Volume (3M): 45.12M
• Price to Earnings (P/E): 82.1
• Beta (1Y): 2.08
• Revenue Growth: 21.71%
• EPS Growth: 99.00%
• Country: US
• Employees: 28,000
• Sector: Technology
• Sector Strength: 75
• Industry: Semiconductors
• EPS (TTM): 0.96
• Shares Outstanding: 1,621,404,200
• 10 Day Avg. Volume: 47,650,795
• 30 Day Avg. Volume: 45,117,992
• PEG Ratio: -10.45
• Price to Book (P/B): 2.90
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 69.14
• Enterprise Value/Market Cap: 0.89
• Enterprise Value/Revenue: 1.71
• Enterprise Value/Gross Profit: 12.49
• Enterprise Value/Ebitda: 8.88
• 1Y Price Target: $126.55
• Price Target Upside: 14.31% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 31

• Rating: 81 Outperform
• Price Target: $133.00 ▲( 20.13% Upside)

AMD's overall score reflects its strong financial performance and promising growth potential, particularly in the AI and data center sectors. Despite high valuation risks, strategic initiatives and positive earnings results support a favorable outlook.

Positive Factors

Financial Strategy

AMD's $6 billion addition to its buyback program signals strong confidence in the company's future performance and shareholder value.

Market Position

AMD is on track to establish itself as a leading alternative to NVIDIA in the CPU market while continuing to gain market share.

Product Launch

The MI355 launch and AMD's confidence in expanding its deployment, including the potential acquisition of a net new hyperscale customer, are viewed positively.

Negative Factors

Competitive Pressure

AMD faces competitive pressures from larger AI competitors and potential recovery by Intel under new management.

Investor Interest

A significant decrease in AMD's ownership among large-cap US active fund managers indicates reduced investor interest.

Product Performance

Investor focus on DC-GPUs is affected by underwhelming performance and recent write-downs.

Advanced Micro Devices Business Overview & Revenue Model

Company Description

Advanced Micro Devices, Inc. (AMD) is a multinational semiconductor company that specializes in developing high-performance computing and graphics solutions. Headquartered in Santa Clara, California, AMD designs and produces a wide range of products, including microprocessors, motherboard chipsets, embedded processors, and graphics processors for various applications such as personal computers, gaming consoles, and data centers. The company's innovative technologies power a broad array of devices and experiences, making it a key player in the technology and electronics sectors.

How the Company Makes Money

AMD generates revenue primarily through the sale of its semiconductor products, which are categorized into several key segments. The Computing and Graphics segment is a major revenue driver, accounting for the sale of desktop and notebook microprocessors, accelerated processing units (APUs), discrete graphics processing units (GPUs), and professional graphics products. Additionally, the Enterprise, Embedded, and Semi-Custom segment includes sales from server and embedded processors, as well as semi-custom System-on-Chip (SoC) products, which are used in gaming consoles. AMD's revenue is also bolstered by strategic partnerships and collaborations with major technology companies, original equipment manufacturers (OEMs), and original design manufacturers (ODMs). These partnerships help AMD expand its market reach and enhance its competitive position in the rapidly evolving semiconductor industry.

Advanced Micro Devices Financial Statement Overview

Summary

AMD exhibits strong financial health, characterized by robust revenue growth, efficient cost management, and a stable balance sheet. The company is well-positioned in the semiconductor industry with solid cash flow generation. Potential areas for improvement include enhancing net profitability and optimizing cash conversion.

Income Statement

AMD has demonstrated strong revenue growth over the years, with a notable increase from 2023 to TTM. The gross profit margin has also improved, showcasing effective cost management. However, while the net profit margin has increased, it remains modest, indicating room for enhanced profitability. The EBIT and EBITDA margins are stable, reflecting healthy operational efficiency.

Balance Sheet

The balance sheet is robust, marked by a low debt-to-equity ratio, indicating conservative leverage. Return on equity is positive, but there's potential for higher returns. The high equity ratio suggests a strong financial structure, providing stability and resilience against market fluctuations.

Cash Flow

Cash flow generation is solid, with operating cash flow and free cash flow showing an upward trend. Free cash flow growth is notable, indicating efficient capital expenditure management. However, the operating cash flow to net income ratio suggests potential for improved cash conversion efficiency.

Breakdown
Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement		Total Revenue
25.79B	22.68B	23.60B	16.43B	9.76B
	Gross Profit
12.72B	10.46B	12.05B	7.93B	4.35B
	EBIT
1.90B	401.00M	1.26B	3.65B	1.37B
	EBITDA
1.90B	4.15B	5.53B	4.17B	1.68B
	Net Income Common Stockholders
1.64B	854.00M	1.32B	3.16B	2.49B
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
5.13B	5.77B	5.86B	3.61B	2.29B
	Total Assets
69.23B	67.89B	67.58B	12.42B	8.96B
	Total Debt
2.21B	3.00B	3.17B	661.00M	531.00M
	Net Debt
-1.57B	-930.00M	-1.66B	-1.87B	-1.06B
	Total Liabilities
11.66B	11.99B	12.83B	4.92B	3.13B
	Stockholders Equity
57.57B	55.89B	54.75B	7.50B	5.84B
Cash Flow		Free Cash Flow
2.40B	1.12B	3.12B	3.22B	777.00M
	Operating Cash Flow
3.04B	1.67B	3.56B	3.52B	1.07B
	Investing Cash Flow
-1.10B	-1.42B	2.00B	-686.00M	-952.00M
	Financing Cash Flow
-2.06B	-1.15B	-3.26B	-1.90B	6.00M

Advanced Micro Devices Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 110.71
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For AMD, the sentiment is Neutral. The current price of 110.71 is above the 20-day moving average (MA) of 105.37, above the 50-day MA of 100.69, and below the 200-day MA of 126.60, indicating a neutral trend. The MACD of 4.62 indicates Negative momentum. The RSI at 58.37 is Neutral, neither overbought nor oversold. The STOCH value of 43.67 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for AMD.

Advanced Micro Devices Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
AMD	81 Outperform	$184.05B	82.14	3.90%	―	21.71%	99.00%
NVDA	80 Outperform	$3.28T	45.74	119.18%	0.03%	114.20%	146.26%
QCOM	80 Outperform	$161.81B	15.01	42.21%	2.25%	16.15%	32.28%
TSM	77 Outperform	$846.57B	24.89	32.11%	1.01%	35.45%	47.97%
TXN	70 Outperform	$163.72B	34.14	29.04%	2.90%	-4.48%	-17.82%
Sector *	61 Neutral	$11.41B	10.19	-7.05%	2.95%	7.46%	-10.52%
INTC	45 Neutral	$92.78B	―	-18.66%	2.42%	-3.97%	-562.40%

Advanced Micro Devices Corporate Events

AMD Sells ZT Systems Business to Sanmina

On May 19, 2025, AMD announced a definitive agreement to sell its ZT Systems data center infrastructure manufacturing business to Sanmina for $3 billion in cash and stock, with a contingent payment of up to $450 million. The transaction, expected to close by the end of 2025, aligns with AMD’s strategic plan announced in August 2024 and will make Sanmina a preferred manufacturing partner for AMD’s cloud rack and AI solutions. This move is anticipated to enhance AMD’s U.S.-based manufacturing capabilities and accelerate the deployment of AI systems for cloud customers, strengthening its position in the AI and data center markets.

The most recent analyst rating on (AMD) stock is a Hold with a $150.00 price target. To see the full list of analyst forecasts on Advanced Micro Devices stock, see the AMD Stock Forecast page.

AMD Stockholders Approve Key Proposals at Annual Meeting

On May 14, 2025, Advanced Micro Devices held its Annual Meeting of Stockholders where several key proposals were voted on. All director nominees were elected, and significant approvals included the ratification of Ernst & Young LLP as the independent registered public accounting firm, the approval of executive compensation, and amendments to increase authorized shares and limit officer liability. However, a proposal to remove the holding requirement for calling a special meeting was not approved. These decisions reflect the company’s strategic directions and governance priorities.

The most recent analyst rating on (AMD) stock is a Hold with a $150.00 price target. To see the full list of analyst forecasts on Advanced Micro Devices stock, see the AMD Stock Forecast page.

AMD Reports Strong Q1 2025 Financial Results

On May 6, 2025, AMD announced its financial results for the first quarter of 2025, reporting a revenue of $7.4 billion, a 36% increase year-over-year, with significant growth in its data center and AI segments. The company highlighted its strong product portfolio and consistent execution as key drivers for its performance, despite challenges in the macro and regulatory environment. AMD also emphasized its strategic acquisitions and partnerships aimed at enhancing its AI capabilities and expanding its market reach, positioning the company for continued growth and value creation for shareholders.

AMD Completes Acquisition of ZT Systems for AI Expansion

On March 31, 2025, AMD announced the completion of its acquisition of ZT Systems, a leading provider of AI and general-purpose compute infrastructure for hyperscale providers. This strategic move aims to enhance AMD’s capabilities in delivering end-to-end AI solutions by integrating ZT Systems’ expertise with AMD’s CPU, GPU, and networking technologies. The acquisition is expected to accelerate AMD’s AI infrastructure deployment and provide a competitive edge in the $500 billion data center AI accelerator market projected for 2028. The transaction is anticipated to be accretive on a non-GAAP basis by the end of 2025, and AMD is exploring strategic partnerships to divest ZT Systems’ manufacturing business.

AMD Approves Executive Bonuses for Fiscal Year 2024

On February 18 and 19, 2025, Advanced Micro Devices, Inc.’s Board of Directors approved annual cash performance bonuses for its executive officers under the Executive Incentive Plan for fiscal year 2024. The bonuses, which are expected to be paid in March 2025, include $670,106 for Jean Hu, $665,593 for Phil Guido, $658,825 for Forrest Norrod, and $1,776,120 for Lisa T. Su. These awards reflect the company’s commitment to recognizing and rewarding the contributions of its leadership team, potentially impacting the company’s operational focus and stakeholder confidence.