AMD Stock Ready For Growth In The Era of AI

AMD Stock Ready For Growth In The Era of AI

Blog Article

AI Expectations and Reality amd stock
Entering 2024, CEO Lisa Su and her team were increasingly optimistic about AI chip sales, projecting $2 billion in accelerated-computing sales, which was later raised to $3.5 billion. This significant, though not massive, new market represented a substantial opportunity for AMD, which had $22.8 billion in sales over the last 12 months. The new MI300 accelerated-computing system became AMD's fastest product to reach $1 billion in revenue, achieving this milestone in just two quarters.

Click to Read the Full Article at the Stock Market Learning CenterDespite initial excitement, the $3.5 billion outlook for 2024 AI sales was not increased during the first-quarter update. Furthermore, second-quarter guidance was underwhelming, with expected revenue of $5.7 billion—up 4% from the prior quarter and 6% year-over-year.amd tock
Comparing AMD and Nvidia
Unlike Nvidia, whose data-center AI revenue has shown exponential growth, AMD's focus differs. Since the acquisition of Xilinx in early 2022, the primary reason for optimism about AMD has been its potential for rising profit margins. amd sock


The recent bear market significantly impacted AMD sock, especially in consumer spending on PCs and laptops. The client revenue segment reported an operating profit of $86 million in the first quarter, with a margin of only 6%. However, there is substantial room for improvement as consumer PC spending stabilizes. amdstock

While AMD's data center AI chips have not offset weaknesses in other business areas like embedded (Xilinx) and gaming (video game consoles), they have amd stick contributed to profit-margin expansion. Data center operating margins were 23% in the first quarter, compared to 11% the previous year.