Advanced Micro Devices (AMD) AI Stock Analysis

• Market Cap: $220.69B
• Dividend Yield: N/A
• Average Volume (3M): 45.88M
• Price to Earnings (P/E): 99.8
• Beta (1Y): 2.13
• Revenue Growth: 21.71%
• EPS Growth: 99.00%
• Country: US
• Employees: 28,000
• Sector: Technology
• Sector Strength: 88
• Industry: Semiconductors
• EPS (TTM): 0.96
• Shares Outstanding: 1,621,404,200
• 10 Day Avg. Volume: 69,653,952
• 30 Day Avg. Volume: 45,878,441
• PEG Ratio: 2.64
• Price to Book (P/B): 3.59
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 75.53
• Enterprise Value/Market Cap: 0.94
• Enterprise Value/Revenue: 2.04
• Enterprise Value/Gross Profit: 14.86
• Enterprise Value/Ebitda: 10.14
• 1Y Price Target: $132.76
• Price Target Upside: -4.16% Downside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 34

• Rating: 80 Outperform
• Price Target: $165.00 ▲(19.12%Upside)

AMD's overall stock score of 80.3 reflects its strong financial performance and positive earnings outlook, driven by growth in key segments like data centers and AI. While technical indicators show bullish momentum, the high P/E ratio suggests potential overvaluation. Recent corporate actions further bolster its strategic positioning.

Positive Factors

Energy Efficiency

AMD exceeded its five-year goal to improve energy efficiency in AI training and high-performance computing nodes by 38x, surpassing the original target of 30x by 2025.

Product Launch

AMD officially launched its much-anticipated Instinct MI350 Series, which is in production and shipping to lead partners, with expected volume revenue ramp in the third quarter.

Software Capabilities

AMD's recent software acquisitions and newly launched ROCm 7 have narrowed the gap with NVIDIA's CUDA platform, enabling greater customer flexibility in architecture choices.

Negative Factors

Customer Growth

AMD may not grow as much as expected across their largest customers for the Mi350 series.

Product Uncertainty

MI400 is still something of a show-me story, indicating uncertainty about its impact.

Revenue Trends

The revenue trends at AMD would suggest those customers have stepped away rather than leaned into using AMD.

Advanced Micro Devices Business Overview & Revenue Model

Company Description

Advanced Micro Devices, Inc. operates as a semiconductor company worldwide. The company operates in two segments, Computing and Graphics; and Enterprise, Embedded and Semi-Custom. Its products include x86 microprocessors as an accelerated processing unit, chipsets, discrete and integrated graphics processing units (GPUs), data center and professional GPUs, and development services; and server and embedded processors, and semi-custom System-on-Chip (SoC) products, development services, and technology for game consoles. The company provides processors for desktop and notebook personal computers under the AMD Ryzen, AMD Ryzen PRO, Ryzen Threadripper, Ryzen Threadripper PRO, AMD Athlon, AMD Athlon PRO, AMD FX, AMD A-Series, and AMD PRO A-Series processors brands; discrete GPUs for desktop and notebook PCs under the AMD Radeon graphics, AMD Embedded Radeon graphics brands; and professional graphics products under the AMD Radeon Pro and AMD FirePro graphics brands. It also offers Radeon Instinct, Radeon PRO V-series, and AMD Instinct accelerators for servers; chipsets under the AMD trademark; microprocessors for servers under the AMD EPYC; embedded processor solutions under the AMD Athlon, AMD Geode, AMD Ryzen, AMD EPYC, AMD R-Series, and G-Series processors brands; and customer-specific solutions based on AMD CPU, GPU, and multi-media technologies, as well as semi-custom SoC products. It serves original equipment manufacturers, public cloud service providers, original design manufacturers, system integrators, independent distributors, online retailers, and add-in-board manufacturers through its direct sales force, independent distributors, and sales representatives. The company was incorporated in 1969 and is headquartered in Santa Clara, California.

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 across all key areas. The income statement shows impressive revenue and profit growth, supported by efficient cost management. The balance sheet reflects a stable and low-leverage structure, while the cash flow statement highlights robust cash generation capabilities.

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	27.75B	25.79B	22.68B	23.60B	16.43B	9.76B
Gross Profit	13.90B	12.72B	10.46B	12.05B	7.93B	4.35B
EBITDA	5.97B	5.26B	4.15B	5.53B	4.17B	1.68B
Net Income	2.23B	1.64B	854.00M	1.32B	3.16B	2.49B
Balance Sheet
Total Assets	71.55B	69.23B	67.89B	67.58B	12.42B	8.96B
Cash, Cash Equivalents and Short-Term Investments	7.31B	5.13B	5.77B	5.86B	3.61B	2.29B
Total Debt	4.73B	2.21B	3.00B	3.17B	661.00M	531.00M
Total Liabilities	13.67B	11.66B	11.99B	12.83B	4.92B	3.13B
Stockholders Equity	57.88B	57.57B	55.89B	54.75B	7.50B	5.84B
Cash Flow
Free Cash Flow	2.75B	2.40B	1.12B	3.12B	3.22B	777.00M
Operating Cash Flow	3.46B	3.04B	1.67B	3.56B	3.52B	1.07B
Investing Cash Flow	-1.32B	-1.10B	-1.42B	2.00B	-686.00M	-952.00M
Financing Cash Flow	-267.00M	-2.06B	-1.15B	-3.26B	-1.90B	6.00M

Advanced Micro Devices Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 138.52
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• 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 Positive. The current price of 138.52 is above the 20-day moving average (MA) of 128.76, above the 50-day MA of 114.94, and above the 200-day MA of 123.97, indicating a bullish trend. The MACD of 7.62 indicates Negative momentum. The RSI at 65.79 is Neutral, neither overbought nor oversold. The STOCH value of 58.78 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for AMD.

Advanced Micro Devices Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
NVDA	84 Outperform	$3.85T	50.81	115.46%	0.03%	86.17%	81.36%
QCOM	81 Outperform	$175.02B	16.23	42.21%	2.23%	16.15%	32.28%
AMD	80 Outperform	$220.69B	99.77	3.90%	―	21.71%	99.00%
TSM	77 Outperform	$962.93B	28.91	32.11%	1.22%	35.45%	47.97%
TXN	77 Outperform	$188.13B	39.24	29.04%	2.58%	-4.48%	-17.82%
Sector *	56 Neutral	$3.18B	5.11	-5.68%	5.67%	8.05%	-41.83%
INTC	47 Neutral	$99.67B	―	-18.66%	2.19%	-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.