Advanced Micro Devices (AMD) AI Stock Analysis

• Market Cap: $279.58B
• Dividend Yield: N/A
• Average Volume (3M): 58.15M
• Price to Earnings (P/E): 99.2
• Beta (1Y): 2.11
• Revenue Growth: 27.17%
• EPS Growth: 108.67%
• Country: US
• Employees: 28,000
• Sector: Technology
• Sector Strength: 98
• Industry: Semiconductors
• EPS (TTM): 0.48
• Shares Outstanding: 1,622,843,800
• 10 Day Avg. Volume: 82,812,070
• 30 Day Avg. Volume: 58,146,218
• 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: 0.83
• Enterprise Value/Revenue: 7.85
• Enterprise Value/Gross Profit: 17.75
• Enterprise Value/Ebitda: 41.83
• 1Y Price Target: $181.36
• Price Target Upside: 5.27% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 38

• Rating: 78 Outperform
• Price Target: $199.00 ▲(15.51% Upside)

AMD's overall stock score reflects its strong financial performance and positive earnings call, which highlight robust revenue growth and optimistic future guidance. Technical analysis supports a bullish outlook, although high valuation metrics suggest caution. The company's strategic focus on AI and data center opportunities positions it well for future growth, despite current valuation concerns.

Positive Factors

AI Business Growth

AMD's AI business is expected to grow significantly, driven by major customers like Microsoft, Meta, Oracle, and Amazon.

Data Center Growth

AMD is seeing strong traction with its Data Center GPU solutions, with MI355 expected to drive strong double-digit growth for the Data Center segment.

Negative Factors

Investor Expectations

Investor expectations are considered to be well ahead of realistic estimates for Data Center GPU revenue growth.

Operational Challenges

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.

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. 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 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: Positive
• Last Price: 172.28
• 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 Positive. The current price of 172.28 is above the 20-day moving average (MA) of 167.12, above the 50-day MA of 144.92, and above the 200-day MA of 123.92, indicating a bullish trend. The MACD of 8.28 indicates Positive momentum. The RSI at 61.40 is Neutral, neither overbought nor oversold. The STOCH value of 59.43 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	82 Outperform	$4.44T	58.64	115.46%	0.02%	86.17%	81.36%
AMD	78 Outperform	$279.58B	99.17	4.70%	―	27.17%	108.67%
QCOM	77 Outperform	$159.22B	14.23	44.62%	2.32%	15.82%	34.20%
TSM	77 Outperform	$1.02T	27.53	33.29%	1.12%	38.65%	―
TXN	68 Neutral	$170.21B	34.22	29.84%	2.96%	3.62%	-5.27%
Sector *	61 Neutral	$35.87B	6.13	-9.30%	2.06%	7.63%	-6.38%
INTC	49 Neutral	$87.32B	―	-19.24%	2.42%	-3.72%	-2120.70%

Advanced Micro Devices Corporate Events

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.

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 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.

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 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.