AMD stock rises on Q1 earnings beat, better-than-expected outlook

AMD (AMD) reported its first quarter results after the bell on Tuesday, beating analysts’ expectations on the top and bottom lines and topping Wall Street’s projections on second quarter revenue outlook.

AMD stock rose more than 6% on the news.

For the quarter, AMD saw earnings per share (EPS) of $1.37 on revenue of $10.25 billion. Analysts were calling for EPS of $1.28 and revenue of $9.89 billion, according to Bloomberg analyst consensus estimates.

The company saw EPS of $0.96 and revenue of $7.43 billion in the same quarter last year.

In the second quarter, AMD says it will see between $10.9 billion and $11.5 billion in revenue. Wall Street had the amount pegged at $10.52 billion.

AMD’s Q1 data center revenue came in at $5.8 billion, up 57% year over year and ahead of expectations of $5.6 billion.

The company’s earnings come after Intel (INTC) reported its own earnings on April 23, beating analysts’ expectations on the top and bottom lines and providing a better-than-anticipated outlook on the strength of its data center business. That sent Intel stock soaring 24%.

CPUs are becoming increasingly important in data centers due to the explosion of interest in AI agents, semi- or fully autonomous AI bots that can perform tasks on users’ behalf.

When agents take action, they use tools and software that run on CPUs, driving a massive increase in processor demand.

Like Intel, AMD sells its own line of CPUs, but unlike its rival, it also offers high-powered GPUs for training and running AI models, giving it the chance to attract a broader array of customers.

To that end, AMD is preparing to launch its first rack-scale system called Helios, which will combine the company’s GPUs and CPUs into a larger server rack, similar to Nvidia’s Vera Rubin-powered NVL72 rack system.

AMD’s Client segment brought in $2.9 billion versus expectations of $2.73 billion, while its gaming business hit $720 million. Wall Street was projecting $668 million.

According to the International Data Corporation, global PC shipments are expected to fall 11.3% in 2026 due to the ongoing global memory shortage. Tablet shipments, meanwhile, could decline 7.6%.

During Apple’s (AAPL) Q2 earnings call last week, CEO Tim Cook noted that increased memory prices will likely hit that company’s margins in the coming quarters.