Nauman Khan
This article first appeared on GuruFocus.
AMD (NASDAQ:AMD) is heading into its Nov. 3 earnings report with a new challenge: investors are questioning whether demand across the chip industry can hold up after a disappointing outlook from its biggest PC processor rival.
The stock dropped nearly 10% in Friday morning trading.
The pressure followed Intel’s (INTC) latest forecast, which pointed to a difficult stretch for personal computer sales. Intel expects fourth-quarter revenue from its client computing division to decline more than 20% from the previous quarter as memory supply constraints and cautious corporate spending weigh on orders.
The implications extend to AMD’s business because both companies sell processors for PCs and data center servers. Intel also expects weakness in the PC market to persist into the first half of 2027, raising questions about demand conditions across the industry.
Despite the share-price decline, two investment firms retained positive views. Jefferies kept its $650 target and Buy recommendation, while Susquehanna lifted its target from $620 to $650 and maintained a Positive rating. Both firms pointed to AMD’s growth prospects in data center computing.
