Advanced Micro Devices (AMD) AI Stock Analysis

• Market Cap: $263.92B
• Dividend Yield: N/A
• Average Volume (3M): 61.68M
• Price to Earnings (P/E): 93.6
• Beta (1Y): 2.12
• Revenue Growth: 27.17%
• EPS Growth: 108.67%
• Country: US
• Employees: 28,000
• Sector: Technology
• Sector Strength: 87
• Industry: Semiconductors
• EPS (TTM): 0.48
• Shares Outstanding: 1,622,843,800
• 10 Day Avg. Volume: 44,161,112
• 30 Day Avg. Volume: 61,676,936
• PEG Ratio: 1.36
• Price to Book (P/B): 3.52
• Price to Sales (P/S): 7.87
• P/FCF Ratio: 84.33
• Enterprise Value/Market Cap: 0.88
• Enterprise Value/Revenue: 7.85
• Enterprise Value/Gross Profit: 17.75
• Enterprise Value/Ebitda: 41.83
• 1Y Price Target: $184.74
• Price Target Upside: 13.60% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 35

• Rating: 77 Outperform
• Price Target: $190.00 ▲(16.83% Upside)

AMD's overall stock score of 77 reflects strong financial performance and positive earnings call outcomes, tempered by a high valuation and mixed technical indicators. The company's strategic focus on AI and GPUs positions it well for future growth, despite current valuation concerns.

Positive Factors

Growth Potential

AMD's AI sales are expected to grow 23% YoY in 2025 and 58% in 2026, driven by ramps at major companies like Amazon, Oracle, Meta, and openAI.

Partnerships and Market Position

Contacts have increasingly noted that hyperscalers are working with AMD in a partnership manner, expressing true interest in deploying AMD at scale.

Revenue Growth

The increase in AMD's Client CPU revenue by 67% year-over-year indicates strong demand and performance.

Negative Factors

Operational Expenses

There are concerns about AMD's ability to drive significant scale in Datacenter GPUs over time, as earnings power may be hampered by the significant operational expenses expected to support its AI software and systems efforts.

Regulatory Challenges

The AI GPUs could be banned in China again, impacting AMD's potential sales.

Valuation Concerns

The neutral rating is maintained due to high growth but an expensive valuation.

Advanced Micro Devices Business Overview & Revenue Model

Company Description

Advanced Micro Devices, Inc. (AMD) is a leading global semiconductor company that designs and manufactures innovative computing and graphics solutions for a wide range of applications. Founded in 1969 and headquartered in Santa Clara, California, AMD operates in two primary segments: Computing and Graphics, and Enterprise, Embedded, and Semi-Custom. The company is renowned for its high-performance processors, including the Ryzen series for desktops and laptops, and the EPYC series for servers, as well as its Radeon graphics cards, which cater to gaming and professional markets.

How the Company Makes Money

AMD generates revenue primarily through the sale of its semiconductor products, which include microprocessors, graphics processors, and system-on-chip (SoC) solutions. The company's key revenue streams are derived from the Computing and Graphics segment, which includes desktop and mobile processors, as well as graphics cards, and the Enterprise, Embedded, and Semi-Custom segment, which includes server processors and custom solutions for gaming consoles. Significant partnerships with major technology companies, including collaborations with Microsoft and Sony for gaming consoles, and strategic alliances in cloud computing and data centers, further enhance AMD's market presence and revenue potential. The company's focus on innovation and performance, coupled with increasing demand for high-performance computing in various sectors, contributes to its financial growth.

Advanced Micro Devices Financial Statement Overview

Summary

AMD exhibits strong financial health with robust revenue growth, efficient cost management, and a stable balance sheet. The company has a low debt-to-equity ratio and strong cash flow generation, positioning it well for future growth.

Income Statement

AMD has demonstrated robust revenue growth with a TTM increase from $25.79 billion to $27.75 billion, indicating a growth rate of approximately 7.63%. The gross profit margin is healthy at 50.91%, supported by a net profit margin of 8.02% for the TTM. The EBIT margin stands at 9.62%, and the EBITDA margin is 21.43%, reflecting strong operational efficiency. These metrics highlight AMD's effective cost management and profitability in the competitive semiconductor industry.

Balance Sheet

AMD maintains a strong financial position with a debt-to-equity ratio of 0.08, indicating low leverage. The return on equity is 3.85% for the TTM, showing effective utilization of equity to generate profits. The equity ratio is 80.91%, suggesting a solid capital structure with a significant portion of assets financed by equity. This stability positions AMD well for future growth opportunities.

Cash Flow

AMD's cash flow performance is commendable, with a free cash flow growth rate of 14.46% from the previous year. The operating cash flow to net income ratio is 1.55, indicating strong cash generation relative to net income. Additionally, the free cash flow to net income ratio is 1.24, reflecting efficient cash management and the capability to reinvest in growth initiatives or return value to shareholders.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	29.60B	25.79B	22.68B	23.60B	16.43B	9.76B
Gross Profit	13.10B	11.28B	8.59B	8.50B	7.93B	4.35B
EBITDA	5.56B	5.26B	4.15B	5.53B	4.17B	1.68B
Net Income	2.83B	1.64B	854.00M	1.32B	3.16B	2.49B
Balance Sheet
Total Assets	74.82B	69.23B	67.89B	67.58B	12.42B	8.96B
Cash, Cash Equivalents and Short-Term Investments	5.87B	5.13B	5.77B	5.86B	3.61B	2.29B
Total Debt	3.89B	2.32B	3.11B	2.96B	732.00M	572.00M
Total Liabilities	15.15B	11.66B	11.99B	12.83B	4.92B	3.13B
Stockholders Equity	59.66B	57.57B	55.89B	54.75B	7.50B	5.84B
Cash Flow
Free Cash Flow	4.04B	2.40B	1.12B	3.12B	3.22B	777.00M
Operating Cash Flow	4.88B	3.04B	1.67B	3.56B	3.52B	1.07B
Investing Cash Flow	-4.01B	-1.10B	-1.42B	2.00B	-686.00M	-952.00M
Financing Cash Flow	-530.00M	-2.06B	-1.15B	-3.26B	-1.90B	6.00M

Advanced Micro Devices Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 162.63
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• 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 162.63 is below the 20-day moving average (MA) of 170.86, above the 50-day MA of 159.15, and above the 200-day MA of 125.34, indicating a neutral trend. The MACD of 1.31 indicates Positive momentum. The RSI at 46.29 is Neutral, neither overbought nor oversold. The STOCH value of 40.07 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
NVDA	86 Outperform	$4.23T	49.57	109.42%	0.02%	71.55%	64.54%
QCOM	79 Outperform	$173.43B	15.50	44.62%	2.14%	15.82%	34.20%
AMD	77 Outperform	$263.92B	93.61	4.70%	―	27.17%	108.67%
TSM	77 Outperform	$983.74B	26.28	33.29%	1.17%	38.65%	57.18%
TXN	70 Outperform	$184.08B	37.01	29.84%	2.69%	3.62%	-5.27%
Sector *	61 Neutral	$35.42B	7.71	-10.08%	1.88%	8.71%	-9.18%
INTC	58 Neutral	$106.58B	―	-19.24%	0.51%	-3.72%	-2120.70%

Advanced Micro Devices Corporate Events

AMD Announces Resignation of Chief Accounting Officer

On August 22, 2025, AMD announced the resignation of Mr. Philip Carter, its Corporate Vice President and Chief Accounting Officer, effective September 5, 2025. Mr. Carter is leaving to become the Chief Financial Officer at another company, with no disputes affecting his departure. Ms. Jean Hu, AMD’s Executive Vice President, Chief Financial Officer, and Treasurer, will temporarily take over as Chief Accounting Officer while the company searches for a permanent replacement.

AMD Achieves Record Q2 Revenue Despite Challenges

AMD reported record revenue of $7.7 billion for the second quarter of 2025, despite an operating loss of $134 million, largely due to U.S. export controls affecting its data center GPU products. The company experienced strong demand for its server and PC processors, contributing to a 32% year-over-year revenue growth, and anticipates further growth driven by its AI and computing products. AMD’s strategic collaborations and product launches, including AI solutions and next-generation processors, position it for robust future growth and long-term shareholder value.

AMD Approves Executive Salary Increases Effective July 2025

On June 27, 2025, AMD’s Board of Directors approved salary increases for key executives effective July 1, 2025, reflecting the company’s commitment to retaining top talent. Additionally, on August 15, 2025, these executives will receive long-term incentive awards under the 2023 Equity Incentive Plan, with a mix of performance-based and time-based stock options and units, aligning their compensation with company performance and shareholder returns.