What analysts are expecting from AMD's second quarter results

Wall Street analysts are largely bullish on Advanced Micro Devices ahead of its Q2 earnings report, with firms like Bank of America, Wells Fargo, and UBS raising price targets and forecasting an upside surprise to the consensus EPS of 48 cents on $7.4 billion revenue. This optimism stems from robust demand in data center expansion, strength in core CPU/GPU businesses, and a potentially de-risked PC outlook due to tariff anticipation. Analysts also highlight significant upside potential from continued market share gains in servers and PCs, increasing traction in datacenter GPUs, and the potential resumption of shipments to China.

Analysis

A strong bullish consensus has formed among Wall Street analysts for Advanced Micro Devices (AMD) ahead of its second-quarter earnings report, with multiple investment banks anticipating results will surpass the FactSet consensus forecast of 48 cents EPS on $7.4 billion in revenue. This optimism is underpinned by several key drivers, including robust demand from data center expansion and a strong cloud capital expenditure environment, which analysts at Bank of America and Wells Fargo believe will fuel growth. UBS specifically models that AMD could be annualizing $10 billion in data center GPU revenue by the end of the year, citing strong interest in its MI400 systems. Beyond the enterprise segment, the outlook for the core PC business is viewed as "potentially de-risked" by Bank of America due to consumer behavior ahead of potential tariffs. A significant additional catalyst, identified by Melius Research, is the potential resumption of shipments to China, which could add an estimated $3 billion to annualized AI revenue. This positive sentiment is reflected in upgraded price targets from Bank of America (to $200), Wells Fargo ($185), and UBS (to $210), despite the stock's significant 46% year-to-date appreciation.

Key Decisions for Investors

• Given the broad analyst consensus and multiple price target upgrades, investors may view the upcoming earnings as a potential positive catalyst, driven by expected strength in data center, AI, and PC segments.
• Investors should be mindful of the high expectations already reflected in the stock's 46% year-to-date gain, which creates a high bar for the company's results and forward guidance.
• Pay close attention to management's commentary on the data center GPU revenue run-rate, market share trends in server and PC CPUs, and any updates on the potential to resume shipments to China, as these are the key upside drivers identified by analysts.