TLDR
- AMD reports Q4 earnings Tuesday with analysts expecting revenue of $9.67 billion and adjusted EPS of $1.32
- HSBC analyst Frank Lee raised AMD’s price target to $335 from $300, citing agentic AI as a catalyst for server CPU demand
- OpenAI is reportedly exploring alternatives to Nvidia chips, boosting AMD shares in after-hours trading
- AMD faces global memory shortage impacting PC makers, while data center revenue is projected at $4.97 billion, up 29% year-over-year
- CEO Lisa Su unveiled new products at CES 2026 including the Helios rack-scale server and MI500 series GPUs claiming 1,000x AI performance increase
Advanced Micro Devices reports its fourth-quarter earnings Tuesday after market close. Wall Street expects revenue of $9.67 billion with adjusted earnings per share of $1.32.
Advanced Micro Devices, Inc., AMD
These numbers would represent growth from last year’s Q4 results of $7.7 billion in revenue and $1.09 EPS. For the current quarter, analysts project revenue of $9.42 billion and EPS of $1.23.
The earnings come at a crucial time for the AI chip market. Microsoft and Meta reported their results last week, sparking mixed reactions about AI spending levels.
AMD shares have climbed 114% over the past 12 months. Nvidia, its main competitor, rose 58% during the same period.
On Friday, HSBC analyst Frank Lee raised his price target for AMD to $335 from $300. He maintained his Buy rating on the stock.
Lee pointed to agentic AI as a major driver for server CPU demand. He believes AMD will capture a large portion of this opportunity.
“We expect AMD to be a key beneficiary as the upside potential from server CPUs is not fully priced in,” Lee wrote in his research note.
Memory Shortage Creates Headwinds
AMD faces challenges from the global memory shortage. This supply constraint could force PC makers to raise prices on laptops and desktops.
The shortage may impact AMD’s consumer chip business. Both AMD and Intel are dealing with this industry-wide issue.
Intel reported earlier this year that they couldn’t meet higher demand for server processors due to supply constraints. Lee believes AMD has an advantage here because it uses external foundries rather than producing chips in-house.
Wall Street projects AMD’s data center revenue at $4.97 billion for Q4. This represents a 29% increase from the $3.86 billion reported in Q4 2024.
The client business is expected to generate $2.9 billion in revenue. This segment covers chips used in laptops and PCs.
AMD’s gaming business is forecast to bring in $855 million. That would mark a 52% year-over-year jump from last year’s $563 million.
OpenAI Explores Chip Alternatives
Reuters reported that OpenAI is looking for alternatives to Nvidia’s AI chips. The news sent AMD shares higher in after-hours trading Sunday.
The report suggests potential customers are diversifying their chip suppliers. This could create new opportunities for AMD in the AI accelerator market.
CEO Lisa Su showcased new products at CES 2026 in Las Vegas last month. The company unveiled its Helios rack-scale server, designed to compete directly with Nvidia’s NVL72 system.
Both systems feature 72 GPUs and can connect to create larger AI computing systems. AMD also provided details about its MI500 series GPUs, which the company claims offer up to a 1,000x performance increase versus its older MI300X chips.
Su estimates the AI data center market will reach $1 trillion by 2030. AMD faces growing competition from customers like Google, Amazon, and Microsoft who are developing their own custom chips.
AMD also launched new AI PC chips and announced plans for the humanoid robotics industry during the Las Vegas event.
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