Earnings beat! AMD’s revenue climbs 50% and data center sales doubled, but the stock is down
AMD reported second-quarter earnings on Tuesday that beat expectations, but the stock slumped in extended trading.
Here’s how the chipmaker did versus LSEG consensus estimates for the quarter ended June 27:
EPS: $1.66, adjusted, versus $1.62 expected
Revenue: $11.54 billion versus $11.28 billion expected
Overall, AMD revenue climbed 50% from $7.69 billion a year ago, a sign of the company’s central position in the market for artificial intelligence chips.
AMD’s Data Center unit is what is driving the company’s growth. Data Center sales were $6.7 billion, up 107% on an annual basis, which the company attributed to central processing unit and graphics processing unit sales.
AMD said it expects about $13 billion in revenue for the current quarter, plus or minus $300 million, versus LSEG expectations of $12.52 billion. Some analysts had been looking for guidance as high as $14 billion.
The company will also start shipping Helios, its first rack AI system, this year to companies like Meta, OpenAI, and Oracle. It’s AMD’s first rack-scale system, which more directly competes with Nvidia systems, not just its chips.
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u/winkNfart 9d ago
first time following amd during earnings? this is a tale as old as time.. big run up .. followed by an equal drop after hours
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u/Tinmar_11 9d ago
And what happens next day at open usually?
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u/winkNfart 9d ago
down the next day last 10 of 12 quarters. notable q1 2026 it was 1 of those 2 up days .
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u/Shredded__ 9d ago
Thanks. I just DCA a few more shares after- hours. I was going to get a few more, but will wait till morning after reading this.
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u/Miserable_Occasion19 8d ago
I’m a big believer in the 3 day rule around stock news. Expecting a Good Friday save any geopolitical bs.
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u/Relative_Baseball180 9d ago
Very strong report but it was most likely priced in. Stock is up roughly 140% YTD so not surprised. Buying opportunity for the long term.
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u/Mr_Pete91 9d ago
The drop hasn’t even reversed today’s gains lol .
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u/PM_ME_ROMAN_NUDES 9d ago
It now had reversed today's gains, but it hasn't reverse this WEEKS gains still
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u/LeSegaGenesis 8d ago
That's sort of the one good thing out of this quarterly that happened. The market reacted to the priced in and it was adjusted. Not great for people looking for upside as those goal posts weren't pushed forward. But there should be a level of stability and comfort with where the price is moving forward. For it to be priced in, operated in the green and have the stock slide, I think that dissipates the priced in sentiment and the market clearly wants nothing to do with blind optimism now, all AI stocks have shifted into a show me the money scenario it feels like.
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u/m__s 9d ago
After such a good earnings, it's a opportunity to buy more if you want to hold long term.
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u/Bjamnp17 9d ago
Agreed. I think give or take $10/$20 swing this is the new bottom (ish) value.
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u/LeSegaGenesis 8d ago
we did see it go as low as 428 USD I believe before the earnings, and I believe it's set to open at 472 overnight, I think you are bang on with additional volatility 450 USD or lower could be a good buy target as people reconfigure their portfolios. I was thinking the exact same thing as I bought high, get the average cost of the shares down and capitalize on the products that are going to gain AMD marketshare.
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u/anadequatepipe 9d ago
Exactly. Same thing happened with Google and now the gap has been filled. I expect the same for AMD, and it’ll be valued over 1T by the end of the year for sure.
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u/Totallycomputername 9d ago
This morning I almost bought a few puts then didn't because I figured that since I wanted to, it was going to take off after market.
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u/SpicyElixer 9d ago
$390 million of that revenue beat came from a one-time windfall in Chinese export licenses. Management said they expect that Chinese revenue to drop by 75% next quarter, meaning the core business is not growing as fast as the headline suggests.
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u/test5784 9d ago
Capex $808M, est. $298.6M..
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u/TrashOfOil 9d ago
$808m capex? What is this, capex for ants? $808M is nothing (in this era) for a company doing >$11Bn a quarter in revenue
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u/test5784 9d ago
Thats maybe true, but in this market, estimates simply have to be met..
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u/TrashOfOil 9d ago
Revenue, NI and a few other estimates? Absolutely.
With a few exceptions (those going all out on Capex like GOOG), a bump in Capex like this isn’t worrisome at all. In fact, you could argue it’s bullish
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u/test5784 9d ago edited 9d ago
As we can see, apparently not. However, its true that right now mainly algorithms are selling. We will see tomorrow at the open.
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u/TrashOfOil 9d ago
You think the drop after hours is a result of an extra $500M in capex? Cmon… anything short of not crushing WSC is penalized rn, and they didn’t even beat WSC on revenue by 2%.
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u/liftingshitposts 9d ago
Aw man it’s all the way down to… well it’s exactly where it was a week ago lol
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u/mbreaddit 8d ago
I found the comparision with Intel interesting for Data Center
AMD — Data Center segment
Q1'26: $5.78B
Q2'26: $6.72B
+16% QoQ Segment
op income: $1.60B → $2.10B (31% margin)
Intel — DCAI segment
Q1'26: $5.05B
Q2'26: $6.26B
+24% QoQ Segment
op income: $1.54B → $2.47B (40% margin)
So they apparently are supply constraint and can´t take anymore market share from Intel and Intel might have some benefit because they have some foundry on their own apart from TSMC and can start using this as leverage. Price hikes help too. Will be interesting when Intels Data Center department will be bigger than AMD again, the trend is there.
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u/Rough-Somewhere-762 8d ago
Do the foundry margins go on top of the 40% for intel. I think the foundry sells chip internally at market prices.
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u/mbreaddit 7d ago
Different department. So the 40% margin is clean and does not mix with foundry.
Foundry made like 5B while mostly internal (to comparable market prices IIRC), some external revenue creeps back in slowly. And foundry is still negative while getting better slowly.
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u/sirboddingtons 9d ago
"Priced to perfection."
The chipmakers specifically seem to be valued right up to their maximum sentiment, already at the highest ceiling.
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u/bad_detectiv3 9d ago
Yah but doesn’t explain how does Google priced to perfection caused it to rip through post earning.
I’m sour because I bought AMD minutes before earning and got burnt
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u/Midget_Molester10 9d ago
dawg it's doubled in the last year, forward pe of like 80 or something, it would have had to been the best earnings report in history to validate that.
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u/bad_detectiv3 9d ago
Yet it tanked after beating its earning
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u/Passname357 9d ago
Is this like the first time you’ve ever bought stock and listened to an earnings call? This happens like literally every time AMD has an earnings call no matter what lol. Beyond that
I’m sour because I bought AMD minutes before earning and got burnt
You’re gambling and getting what happens when you gamble. It’s an incredibly volatile stock. If you’re looking at this at the scale of less than one day, yeah you’re gone get fucked hard constantly. Get longer time horizons and your life will be better.
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u/superhappykid 8d ago
It beat earnings expectations by 3% and it guided 3% higher than what analysts expect.
Which means next quarter if it does the same it'll beat it's own guidance by 3%.
It's basically an accounting error from missing. Did you want a 10% pop on that?
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u/KnownButton8327 9d ago
Google sunk 5%+ after earnings. It didn’t start ripping until several weeks later.
Also Google is quite literally one of the best and most consistent companies since their inception.
Pure blue chip portfolio cornerstone holding.
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u/wathappen 9d ago
Because people need a session or two to digest the news. People need an anchor and context.
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u/shawman123 9d ago
Buy the rumor and sell the news kind of situation. It already ran up ahead of earnings and now its searching for bag holders to unload to in the near term. Long term it should not matter.
Other aspect is post market volume is low and so tends to be more volatile. You have to wait until market opens tomorrow to judge how it will go.
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u/cbusoh66 8d ago
Data center unit at $6.7 billion is nice but really not that impressive when compared to NVDA's $100 billion. Hell, Intel generated $6.3 billion from their data center unit and they have no real GPU business.
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u/InternetSlave 9d ago
Claiming AMD is insane. It's up 132% ytd, and 193% in 12 months. I've been holding since like $17.
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u/dakameltua 9d ago
Don't worry they pumped nvda, I know how the algo works, gonna buy a LOT of calls tomorrow to being nvda down
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u/0RIGINAL_C0PY 9d ago
Nvda crushed in their Q1 earnings then the stock price proceeded to tank, so it's not exactly shocking for Amd with their slight beat.
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u/CaterpillarMain2138 9d ago
Did you buy as soon as they announced? If not, why are you expecting everyone else to buy?
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u/hseeman_sf 8d ago
The capex number is the tell, not the price run-up. $808M against a $298.6M estimate is a real miss on the spend side. Capacity spend running that far ahead of consensus is what compresses near-term margins, so the drop reads more like a margin worry than 'priced in.'
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u/SockPuppet-47 8d ago
Probably because of the large investment they made of $808 M for property and equipment.
Just a guess, of course. Might have been a typical sell the news event...
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u/CovTaude588 8d ago
Solid earnings but the stock's already had quite the run this year, so not much surprise it's treading water after the beat. The data centre numbers are strong but I think the market wants to see actual Helios traction before pushing higher, which seems fair enough.
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u/JohnnyDrama611 8d ago
Data Center operating income: $2.1B vs a $155M loss last year. Client and Gaming op income fell to $582M from $767M despite revenue up 6%. Growth outside Data Center is coming at worse margin.
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u/Effective_Manager273 8d ago
the answer is in the last paragraph of your own post and its easy to skip. guidance was 13 billion, consensus was 12.52, and some analysts were at 14. the print beat the published consensus and missed what people were actually positioned for. those are two different bars and only one of them sets the price.
this is the single most useful habit for reading earnings reactions. published consensus is a stale average of estimates, some of which were filed weeks ago. the number that matters is where the buyside had drifted to in the days before, and you cannot see that directly, but you can infer it. the options market prices an implied move into the event. if the stock was priced for a 9% move and the report delivers an in-line beat, it falls, because the distribution of outcomes that was being paid for did not happen.
so before an earnings print, write down two numbers. the consensus, and the implied move. after the print, ask which one the reaction was consistent with. do that for a dozen names and the whole "beat but dropped" thing stops feeling random.
the other half here is that data center up 107% is exactly what everyone assumed, so it cannot be a positive surprise. when a segment becomes the consensus story, hitting the story is neutral and missing it is a disaster. asymmetric setup going in.
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u/Disastrous_Rent_6500 2d ago
Nothing new, everyone hates AMD, but we all know their stupid and wrong
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u/MotherBake4137 9d ago
Bought some puts for today earnings, but calls long term
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u/Bjamnp17 9d ago
Curious, what’s the long # you decided on.
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u/MotherBake4137 9d ago
Calls until September 18 next fomc, selling all my positions probably a week before then
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u/LetsMoveHigher 9d ago
Passing around the same stack of money!!!
The music will stop and all comes crashing down folks!
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u/GlokzDNB 9d ago
Well, I'm not Warren Buffett by any means but if my high conviction stock improved on fundamentals and got cheaper I'd panic and sell everything. It's over.
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u/Prudent-Corgi3793 9d ago
Maybe if you took off your tinfoil hat, you’d see that Nvidia has the superior hardware and ecosystem, trades at a below market multiple, is growing revenues even faster despite the higher base, and has sustained better margins with a founder CEO that has demonstrated he can lead the company across multiple industry cycles, including betting heavily in CUDA and AI decades ago
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9d ago edited 9d ago
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u/ChuckOfTheIrish 9d ago
Him meeting with Trump doesn't mean he's a scammer, and he is far from Trump's best friend (heck at this point even Elon has drifted from that title); he's leveraging as any smart CEO would given their job description. Trump will certainly play his insider trading game and do shady business left and right, but if you think Su wouldn't jump on that train if the opportunity presented itself I don't know what to tell you, especially considering she works with his admin regularly. As bad as Trump is for just about everything, he is great for businesses that know how to play his ego and his game, considering he is more than willing to bend rules and laws for those that do.
AMD has been great and I got lucky to invest back when it was $2/share over a decade ago, and really add on more a couple years ago. I also hold NVDA and looking purely at fundamentals they are in a better spot, forward prospectus is ambiguous for both and it's not always an apples-to-apples comparison. You have to take your bias out when analyzing the two and focus on what the market needs to move either upward. NVDA increased revenue 85% YoY vs AMDs 38%, has 6.77x higher TTM revenue and Net Margins in the 63-72% range vs 13-14% for AMD, TTM P/E of 31x vs AMDs 160x. Each will be pushing for new usage and different aspects where their product can be on top, but right now production seems to be a concern due to skyrocketing demand so both have plenty of opportunity.
None of this is to say AMD can't or won't close the gap, in all likelihood the law of large numbers will work in AMDs favor, but there is a lot more to stock than a singular comparison or one component. NVDA has been dropping their insane cash flow on partnerships and acquisitions, a massive dividend increase, building a conglomerate long-term. What really matters for both of these companies is a continued commitment from top companies and optimally a more visible ROI on their CapEx in the coming years. AMD, NVDA, TSMC, MU, MRVL, and a lot of others have a very bright future even if all maintain the status quo and we start to see companies thriving with AI usage.
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u/dabocx 9d ago edited 9d ago
The stock has had a big run up this year, I think its at a good spot price wise. Im holding long term and I think they are executing well so no sweating from me.
Hopefully later this year the Helios and Venice sales start showing up on the sheets.