HomeArticlesMarket Minute: AMD Earnings – The Bar is low

Market Minute: AMD Earnings – The Bar is low

2 min read

Tom White

Host

AMD stock is down 33% from a year ago and off over 5% in 2025 as of Monday’s close. The bar is low going into earnings after the bell today with the stock down nearly 50% from last March’s all-time high of $227. Last Quarter, AMD reported Q3 EPS $0.92 versus a consensus $0.91 and revenue of $6.82B vs. a consensus $6.71B. Despite the slight earnings beat, the stock dumped over 10% the next day as guidance came in a bit lighter than expected. This quarter, AMD sees Q4 revenue $7.5B +/- $300M vs. consensus of $7.54B. At the mid-point of the revenue range, this represents year-over-year growth of approximately 22% and sequential growth of approximately 10%. Non-GAAP gross margin is expected to be approximately 54%. 

Let’s take a look at what the option market is predicting going into its results. The option market is predicting a one-standard deviation move of +/- 8.3% or $9.50. The Implied Volatility Percentile is at 66% as of yesterday’s close so uncertainty is in the top third of the 52-week range. 

On the technical front, AMD shares hit 14-month lows last week and are down 5% this year as of Monday’s close. The RSI, or Relative Strength Index, settled at the 38 level yesterday. Anything below the 30 level is considered oversold on a technical basis and is reflective of the weakness that we have seen in the stock.

While the data center segment of AMD’s business is growing, the legacy CPU, gaming and embedded segments continue to lag. The data center segment (which designs its AI accelerators) has become a financial bright spot in AMD's otherwise lagging financial performance. In the first nine months of 2024, data center revenue grew 107% yearly. That comprised 48% of company revenue, up from 25% in the year-ago quarter. With the bar low into earnings, investor focus will be on whether AMD can eat into Nvidia’s (NVDA) substantial lead in AI chip sales and whether we have seen a bottom put in the legacy side of their businesses

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