Advanced Micro Devices, Inc. (AMD) stock plummeted 17% on Wednesday, wiping out over $30 billion in market value and heading for its worst day since 2017.
The company's Q4 headline numbers showed a record $10.3 billion in revenue, but the quality of the beat and AMD's forward guidance left something to be desired.
The China Windfall
A significant portion of AMD's Q4 beat was attributed to a one-time surge in sales to China.
CEO Lisa Su clarified during the company's earnings call that this was not a sustainable trend, but rather the result of clearing a backlog.
“We were pleased to have some MI308 sales in the fourth quarter. Those were actually a license that was approved through, you know, work with, the administration, and you know, those orders were actually from very early in 2025," Su stated.
China sales totaled $390 million, leading analysts to argue that without the boost, AI data center growth would have been merely in line with expectations rather than a breakout.
Guidance Disappoints
Another driver of AMD's stock rout was the outlook for the first quarter of 2026. The company provided a revenue midpoint of $9.8 billion, a sequential step down from Q4.
Despite being technically above analyst consensus, the figure revealed cooling in AMD's “uninterrupted expansion” narrative.
Investors have become accustomed to beat-and-raise cycles from competitors like Nvidia and viewed the downbeat guidance as a lack of near-term momentum.
Su insisted on the call that “AI is accelerating at a pace that I would not have imagined,” but the market chose to focus on the immediate story of the Q1 slowdown.
AMD also addressed its conservative forecast for China sales moving forward.
“We are not forecasting any additional revenue from China just because it’s a very dynamic situation … we thought it prudent not to forecast any additional revenue other than the $100 million that we called out," Su stated.
Perhaps investors will receive another China-based revenue surprise next quarter—but they are not banking on it.
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