AMD Drops 5% Despite Record $11.5B Revenue Beat
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- AMD stock fell 5.32% in early Wednesday trading after the chipmaker posted record Q2 revenue of $11.54 billion (up 50% year-over-year from $7.69 billion) and adjusted EPS of $1.66 versus the $1.62 analysts expected.
- Data center revenue at AMD more than doubled year-over-year and now accounts for 58% of total revenue, up from 42% a year earlier, according to the company's earnings report.
- AMD's capital expenditures surged to $808 million for the quarter, nearly tripling from $282 million a year ago and jumping from $389 million in the March quarter — a move Futurum chief market strategist Shay Boloor called a "shocking upside revision."
- AMD guided Q3 revenue to approximately $13 billion (plus or minus $300 million), topping some analyst estimates of $12.5 billion but missing the highest Street forecasts of up to $14 billion.
- CEO Lisa Su warned of a "softer PC market" in the second half of the year as higher memory and component costs weigh on demand, though she said AMD expects its client business to outperform the broader industry.
- AMD's gaming graphics revenue declined year-over-year as industrywide component cost increases drove up graphics card prices and weighed on demand.
- Futurum's Shay Boloor told Yahoo Finance the stock was "trading nearly 60 times earnings" and that investors needed an exceptional result — not just a beat — to keep the rally going.
Why it matters: AMD beat every line item and still dropped 5% because shares were trading at nearly 60 times earnings, leaving zero room for "good enough." The capex nearly tripling to $808 million is the more telling signal: AMD is investing aggressively to keep pace in AI and data center, which already drives 58% of revenue and is the segment investors are actually underwriting.
