Advanced Micro Devices (AMD) AI Stock Analysis

• Market Cap: $175.31B
• Dividend Yield: N/A
• Average Volume (3M): 44.84M
• Price to Earnings (P/E): 82.4
• Beta (1Y): 2.03
• Revenue Growth: 21.71%
• EPS Growth: 99.00%
• Country: US
• Employees: 28,000
• Sector: Technology
• Sector Strength: 69
• Industry: Semiconductors
• EPS (TTM): 0.96
• Shares Outstanding: 1,621,404,200
• 10 Day Avg. Volume: 42,864,167
• 30 Day Avg. Volume: 44,841,920
• PEG Ratio: -10.45
• Price to Book (P/B): 2.90
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 69.14
• Enterprise Value/Market Cap: 0.94
• Enterprise Value/Revenue: 1.71
• Enterprise Value/Gross Profit: 12.49
• Enterprise Value/Ebitda: 8.88
• 1Y Price Target: $126.14
• Price Target Upside: 12.16% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 31

AMD's overall stock score reflects its strong financial performance and promising growth potential, particularly in the AI and data center sectors. While high valuation and technical indicators suggest caution, strategic acquisitions and positive earnings call support a favorable outlook.

Positive Factors

Market Share

PC market share continues to increase vs Intel, with AMD recording +51% YoY LTM revenue growth in its Client PC segment.

Revenue Growth

Strong MI300X chips, EPYC server CPU, and Ryzen CPU sales drove revenue to grow 36% YoY.

Negative Factors

Export Restrictions

Due to the recent export controls by the Trump administration on AI chip exports to China, AMD expects FY25e revenue reduction to be ~US$1.5bn.

Inventory Management

AMD's inventory levels increased significantly, which could imply potential challenges in managing supply and demand.

Advanced Micro Devices Business Overview & Revenue Model

Company Description

Advanced Micro Devices, Inc. operates as a semiconductor company worldwide. The company operates in two segments, Computing and Graphics; and Enterprise, Embedded and Semi-Custom. Its products include x86 microprocessors as an accelerated processing unit, chipsets, discrete and integrated graphics processing units (GPUs), data center and professional GPUs, and development services; and server and embedded processors, and semi-custom System-on-Chip (SoC) products, development services, and technology for game consoles. The company provides processors for desktop and notebook personal computers under the AMD Ryzen, AMD Ryzen PRO, Ryzen Threadripper, Ryzen Threadripper PRO, AMD Athlon, AMD Athlon PRO, AMD FX, AMD A-Series, and AMD PRO A-Series processors brands; discrete GPUs for desktop and notebook PCs under the AMD Radeon graphics, AMD Embedded Radeon graphics brands; and professional graphics products under the AMD Radeon Pro and AMD FirePro graphics brands. It also offers Radeon Instinct, Radeon PRO V-series, and AMD Instinct accelerators for servers; chipsets under the AMD trademark; microprocessors for servers under the AMD EPYC; embedded processor solutions under the AMD Athlon, AMD Geode, AMD Ryzen, AMD EPYC, AMD R-Series, and G-Series processors brands; and customer-specific solutions based on AMD CPU, GPU, and multi-media technologies, as well as semi-custom SoC products. It serves original equipment manufacturers, public cloud service providers, original design manufacturers, system integrators, independent distributors, online retailers, and add-in-board manufacturers through its direct sales force, independent distributors, and sales representatives. The company was incorporated in 1969 and is headquartered in Santa Clara, California.

How the Company Makes Money

AMD makes money primarily through the sale of its semiconductor products, which include CPUs, GPUs, and custom chip solutions. The company divides its operations into two main segments: Computing and Graphics, and Enterprise, Embedded, and Semi-Custom. In the Computing and Graphics segment, AMD generates revenue from the sale of processors and graphics cards to PC manufacturers and consumers. The Enterprise, Embedded, and Semi-Custom segment includes sales of server processors and technology for game consoles and other embedded applications. AMD also benefits from strategic partnerships and collaborations with major technology companies, which help expand its market reach and drive innovation. Licensing of its intellectual property, although a smaller part of its revenue model, also contributes to its earnings.

Advanced Micro Devices Financial Statement Overview

Summary

AMD exhibits strong financial health, characterized by robust revenue growth, efficient cost management, and a stable balance sheet. The company is well-positioned in the semiconductor industry with solid cash flow generation. Potential areas for improvement include enhancing net profitability and optimizing cash conversion.

Income Statement

AMD has demonstrated strong revenue growth over the years, with a notable increase from 2023 to TTM. The gross profit margin has also improved, showcasing effective cost management. However, while the net profit margin has increased, it remains modest, indicating room for enhanced profitability. The EBIT and EBITDA margins are stable, reflecting healthy operational efficiency.

Balance Sheet

The balance sheet is robust, marked by a low debt-to-equity ratio, indicating conservative leverage. Return on equity is positive, but there's potential for higher returns. The high equity ratio suggests a strong financial structure, providing stability and resilience against market fluctuations.

Cash Flow

Cash flow generation is solid, with operating cash flow and free cash flow showing an upward trend. Free cash flow growth is notable, indicating efficient capital expenditure management. However, the operating cash flow to net income ratio suggests potential for improved cash conversion efficiency.

Breakdown
Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement		Total Revenue
25.79B	22.68B	23.60B	16.43B	9.76B
	Gross Profit
12.72B	10.46B	12.05B	7.93B	4.35B
	EBIT
1.90B	401.00M	1.26B	3.65B	1.37B
	EBITDA
1.90B	4.15B	5.53B	4.17B	1.68B
	Net Income Common Stockholders
1.64B	854.00M	1.32B	3.16B	2.49B
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
5.13B	5.77B	5.86B	3.61B	2.29B
	Total Assets
69.23B	67.89B	67.58B	12.42B	8.96B
	Total Debt
2.21B	3.00B	3.17B	661.00M	531.00M
	Net Debt
-1.57B	-930.00M	-1.66B	-1.87B	-1.06B
	Total Liabilities
11.66B	11.99B	12.83B	4.92B	3.13B
	Stockholders Equity
57.57B	55.89B	54.75B	7.50B	5.84B
Cash Flow		Free Cash Flow
2.40B	1.12B	3.12B	3.22B	777.00M
	Operating Cash Flow
3.04B	1.67B	3.56B	3.52B	1.07B
	Investing Cash Flow
-1.10B	-1.42B	2.00B	-686.00M	-952.00M
	Financing Cash Flow
-2.06B	-1.15B	-3.26B	-1.90B	6.00M

Advanced Micro Devices Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 112.46
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For AMD, the sentiment is Positive. The current price of 112.46 is above the 20-day moving average (MA) of 96.72, above the 50-day MA of 98.58, and below the 200-day MA of 127.41, indicating a neutral trend. The MACD of 2.67 indicates Negative momentum. The RSI at 68.64 is Neutral, neither overbought nor oversold. The STOCH value of 87.76 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for AMD.

Advanced Micro Devices Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
AMD	82 Outperform	$175.31B	82.44	3.90%	―	21.71%	99.00%
NVDA	80 Outperform	$3.00T	41.86	119.18%	0.03%	114.20%	146.26%
QCOM	79 Outperform	$167.03B	15.49	42.21%	2.23%	16.15%	32.28%
TSM	77 Outperform	$817.52B	24.06	32.11%	1.00%	35.45%	―
TXN	70 Outperform	$170.14B	35.48	29.04%	2.87%	-4.48%	-17.82%
Sector *	60 Neutral	$11.39B	10.52	-6.21%	2.95%	7.68%	-11.12%
INTC	48 Neutral	$96.75B	―	-18.66%	2.25%	-3.97%	-562.40%

Advanced Micro Devices Corporate Events

AMD Reports Strong Q1 2025 Financial Results

On May 6, 2025, AMD announced its financial results for the first quarter of 2025, reporting a revenue of $7.4 billion, a 36% increase year-over-year, with significant growth in its data center and AI segments. The company highlighted its strong product portfolio and consistent execution as key drivers for its performance, despite challenges in the macro and regulatory environment. AMD also emphasized its strategic acquisitions and partnerships aimed at enhancing its AI capabilities and expanding its market reach, positioning the company for continued growth and value creation for shareholders.

Spark’s Take on AMD Stock

According to Spark, TipRanks’ AI Analyst, AMD is a Outperform.

AMD’s overall stock score reflects its strong financial performance and promising growth potential, particularly in the AI and data center sectors. However, technical indicators and high valuation pose concerns. The strategic acquisition and positive earnings call support a favorable outlook, moderating the risks associated with current market trends and valuation.

To see Spark’s full report on AMD stock, click here.

AMD Completes Acquisition of ZT Systems for AI Expansion

On March 31, 2025, AMD announced the completion of its acquisition of ZT Systems, a leading provider of AI and general-purpose compute infrastructure for hyperscale providers. This strategic move aims to enhance AMD’s capabilities in delivering end-to-end AI solutions by integrating ZT Systems’ expertise with AMD’s CPU, GPU, and networking technologies. The acquisition is expected to accelerate AMD’s AI infrastructure deployment and provide a competitive edge in the $500 billion data center AI accelerator market projected for 2028. The transaction is anticipated to be accretive on a non-GAAP basis by the end of 2025, and AMD is exploring strategic partnerships to divest ZT Systems’ manufacturing business.

AMD Approves Executive Bonuses for Fiscal Year 2024

On February 18 and 19, 2025, Advanced Micro Devices, Inc.’s Board of Directors approved annual cash performance bonuses for its executive officers under the Executive Incentive Plan for fiscal year 2024. The bonuses, which are expected to be paid in March 2025, include $670,106 for Jean Hu, $665,593 for Phil Guido, $658,825 for Forrest Norrod, and $1,776,120 for Lisa T. Su. These awards reflect the company’s commitment to recognizing and rewarding the contributions of its leadership team, potentially impacting the company’s operational focus and stakeholder confidence.