AMD Joins Chipmakers Struggling to Impress Traders With Upbeat Earnings

You’d have a chip on your shoulder, too. Santa Clara-based chipmaker Advanced Micro Devices reported a record $7.7 billion in second-quarter revenue after the bell Tuesday, a 32% year-over-year increase that bested analysts’ expectations.

The company also projected third-quarter sales of $8.7 billion, topping Wall Street estimates of $8.3 billion. Earnings of 48 cents per share narrowly bested the 47-cent estimate of analysts surveyed by Zacks Investment Research. Yet the stock fell 5% in after-hours trading in what’s becoming a rite of chipmaker reporting days, when good is seen as not good enough.

Promise and Doubt

AMD entered Tuesday saddled with the expectations of a top draft pick (best of luck, Cam Ward). Analysts forecasted second-quarter revenue of $7.4 billion, or a 27% year-over-year increase, according to estimates compiled by S&P Global’s Visible Alpha. That would have matched the company’s first-quarter revenue, which represented a 36% increase as chipmakers have benefited from AI and tech giants like OpenAI, Meta and Microsoft announcing hundreds of billions in spending that will include increasing computing power.

The real hype around AMD has been its share price: Up 45% in 2025, the chipmaker’s stock is the sector’s top performer. Yep, that’s better than even Nvidia, the $4.3 trillion advanced semiconductor maker that is the world’s most valuable company; it has gained a comparatively puny 33% so far this year. But, according to John Peddie Research, mighty Nvidia captured a 92% share of the market for add-in board graphics processing units in the first quarter, up from 88% a year earlier. AMD, by comparison, lost market share, falling to 8% in the first quarter from 12% a year earlier. Lynx Equity Strategies cautioned in a note before Tuesday’s earnings that investors may be too optimistic about the role AMD’s MI350/MI355 and upcoming MI400X GPUs will play in massive chip upscaling at Meta and possibly Amazon Web Services (AWS). “We doubt if AMD has bagged share at AWS,” wrote Lynx’s KC Rajkumar, and “without AWS, AMD may be dependent on one key backer — Meta.” There’s still plenty of upside in the sector; it’s just unclear that AMD will capture it: 

• The Philadelphia Stock Exchange Semiconductor Index is up 10.6% this year, slightly better than the Nasdaq’s 8.3% advance. Optimism has been fueled in recent weeks by some $340 billion in capital spending plans for this year laid out by Alphabet, Amazon, Meta and Microsoft, with much of that expected to include chip-buying.
• But Lynx’s KC Rajkumar warned that “investors are yet to see tangible signs of MI350/MI355 adoption at hyperscale data centers this year.” Falling profits due to more stringent curbs on chip exports and trade uncertainty also hang over earnings.

Not Good Enough: It’s not just AMD. Investors have generally been hard to please for most chipmakers. Shares in UK chipmaker Arm have fallen roughly 15% since last Wednesday, even as it offered a third-quarter forecast in line with analysts’ estimates. Shares in Qualcomm, which beat analysts’ sales and profit estimates and offered a rosy forecast when it reported a day later, have since fallen 8%, with investors more worried about its exposure to the cyclical smartphone market and the forthcoming loss of Apple as its biggest modem customer.