Advanced Micro Devices, Inc. (NASDAQ:AMD) shares are trading lower Wednesday after the company reported fourth-quarter financial results.
Earnings Beat, Segment Results And Outlook
Advanced Micro reported adjusted earnings per share of $1.53, beating the consensus estimate of $1.32. In addition, the company reported revenue of $10.27 billion, beating the consensus estimate of $9.66 billion.
Advanced Micro said Data Center segment revenue totaled $5.4 billion in the fourth quarter, up 39% year over year, driven by demand for AMD EPYC processors and continued ramp of AMD Instinct GPU shipments.
Client and Gaming segment revenue was $3.9 billion in the quarter, up 37% year-over-year. Client revenue rose to $3.1 billion, while Gaming revenue increased to $843 million. Embedded segment revenue came in at $950 million in the quarter, up 3% year-over-year.
CEO Lisa Su said 2025 marked a defining year for Advanced Micro, driven by strong execution and broad-based demand for the company's high-performance and AI platforms.
Advanced Micro anticipates first-quarter revenue of $9.50 billion to $10.10 billion, versus the consensus estimate of $9.38 billion. Shares appear to be reacting negatively as some analysts had been looking for stronger guidance. Expectations were elevated heading into the print with the stock having more than doubled over the past year.
Analyst Changes
Advanced Micro carries a consensus rating of Buy and a consensus price target of $262.76. Following the company’s quarterly results, several analysts weighed in on the stock.
- Keybanc analyst John Vinh maintained an Overweight rating on Advanced Micro and raised the price target from $270 to $300.
- Evercore ISI Group maintained an Outperform rating and raised the price target from $283 to $328.
- Rosenblatt analyst Kevin Cassidy maintained a Buy rating on Advanced Micro and maintained a $300 price target.
- Benchmark analyst Cody Acree reiterated a Buy rating on Advanced Micro and maintained a $325 price target.
Rosenblatt noted that new products are driving operating expenses above what the firm had been modeling, which led analysts to lower EPS estimates slightly.
Meanwhile, Benchmark said that the company's roadmap is gaining material traction with a growing customer base that is demanding higher volumes of high performance compute resources.
“We don't believe the market's initial reaction is indicative of the company's strong record results, its attractive outlook, or the company's rapidly growing leverage to the aggressively expanding AI Data Center market,” Benchmark analysts said in a note to clients.
AMD Shares Fall After Earnings
AMD Price Action: At the time of writing, Advanced Micro shares are trading 9.83% lower at $218, according to data from Benzinga Pro.
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