AI Earnings: 3 Reports to Watch This Week

The AI trade has seen volatility recently, with many of the market's biggest winners coming under pressure as investors increasingly question the massive spending surrounding the technology.

Concerns surrounding stretched valuations and the overall return on AI investments have been major contributors to the weakness, with investors seemingly becoming more selective despite the continued growth story.

Given the recent volatility, this week's earnings releases from Super Micro Computer SMCI, Advanced Micro Devices AMD, and Arm Holdings ARM will undoubtedly be closely watched, particularly concerning the overall AI demand picture.

Let's take a closer look at a few key metrics to watch in each release.

Super Micro Computer

Super Micro Computer, a provider of AI-optimized servers and infrastructure solutions, reports Tuesday, November 3rd. Growth expectations remain sizable, with the Zacks Consensus Estimate calling for $15.7 billion in sales and earnings of $1.24 per share, reflecting 214% and 254% YoY growth, respectively.

AI server demand will be the primary focus, particularly concerning its liquid-cooling solutions and rack-scale systems. The company's ability to convert robust demand into profitable growth will also be critical, making gross margins a key metric to watch.

Importantly, management's sales outlook for the coming quarters should provide further visibility into the AI infrastructure spending picture.

Advanced Micro Devices

Advanced Micro Devices also reports Tuesday, with investors undoubtedly focused on its Data Center results, which have been a major growth driver thanks to demand for its EPYC processors and Instinct AI accelerators.

Our latest Zacks Consensus estimates call for $13.1 billion in sales and earnings of $1.94 per share, reflecting 42% revenue growth on 62% higher earnings. Beyond Data Center sales, investors should watch commentary on its next-generation AI accelerators, customer adoption, and the overall GPU demand pipeline.

Arm Holdings

Arm Holdings rounds out the trio, reporting Wednesday, November 4th. The company licenses semiconductor intellectual property, with its energy-efficient CPU designs becoming increasingly important across data centers and AI-related applications.

Current analyst consensus estimates call for roughly $1.4 billion in sales and earnings of $0.48 per share, suggesting 21% revenue growth on 23% higher earnings. Royalty revenue will be a major focus, particularly concerning the growing adoption of Arm-based processors in cloud infrastructure. Licensing results and continued adoption of its newer architectures will also provide insights into the longer-term growth picture.

Bottom Line

AI-related earnings remain a major theme throughout the current reporting cycle, with Super Micro Computer SMCI, Advanced Micro Devices AMD, and Arm Holdings ARM all gearing up for releases this week.

Beyond the headline results, commentary surrounding AI demand, customer adoption, and forward guidance will be critical in determining whether their impressive growth trajectories can continue.

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report

This article originally published on Zacks Investment Research (zacks.com).

Zacks Investment Research