Advanced Micro Devices, Inc. (NASDAQ:AMD) (AMD)’s second-quarter earnings earned a shrug and a ‘meh’ from analysts, with Matt Bryson at Wedbush calling the results “just OK”.
However, investors seem to be more bullish on the fabless chipmaker’s prospects, with shares closing Tuesday 2.8% higher and surging another 2% in this morning’s pre-market trades.
“We believe investors are appropriately looking past somewhat lacklustre near-term results and towards potential gains starting later this year, and potentially accelerating into 2024/2025,” said Bryson.
Wedbush's analysis of AMD's second-quarter earnings highlighted that while the data centre performance fell slightly short of expectations, client revenues showed a stronger rebound.
AMD’s third-quarter guidance was considered disappointing, with revenues and earnings missing consensus estimates, and concerns about slower growth in enterprise compute.
Wedbush analysts did, however, expressed confidence in president and chief executive Lisa Su's leadership.
“With Lisa Su's AMD having consistently executed over the past few years, we believe this outlook (which should be helped by a significant ramp of shipments for the Department of Energy’s El Capitan supercomputer) and commentary necessarily should be viewed as credible.
“And, supporting a stronger intermediate-term outlook, we believe AMD has a leadership position in server CPUs that should yield more significant future share growth when spending rebounds (and we believe spending on standard servers will necessarily bounce back in 2024).”
AMD shares closed Tuesday at US$117.6 with a market capitalisation of US$189.4 billion, and were set to open Wednesday at US$120.54.