AMD’s Earnings per Share Disappoint as Q2 Results Attract Mixed Reactions

AMD Q2 results surpassed analyst revenue estimates but fell short on adjusted earnings per share. According to Yahoo Finance, the chip maker’s Q3 outlook of between $8.4 billion and $9 billion exceeded analyst expectations of $8.3 billion.

AMD’s Q2 Revenue

Although the US chip maker maintained a strong outlook, its stock prices declined by over 4% in premarket trading. AMD’s revenue for the second quarter stood at $7.69 billion against the $7.42 billion expected by analysts.

Net income for the second quarter rose to $872 million, up from $265 million a year ago. However, the company reported $0.48 in adjusted earnings per share against the expected $0.49. AMD shares have gained over 40% this year as investors seek to capitalize the AI boom. In the second quarter.

AMD is the second-largest by market share in the US after NVIDIA, which holds the largest share of the market. However, large AI companies like OpenAI and Meta are increasingly turning to AMD to supply alternative chips to NVIDIA’s costly semiconductors.

In the quarter under review, AMD unveiled details of its upcoming Instinct MI400 AI chip series which will be released in 2026. OpenAI CEO Sam Altman has already committed to purchase the newest GPUs produced by AMD.

Concerns Mount Over AMD’s Data Center Revenue

Investors expressed concern over AMD’s revenue from its data center unit, which included the lucrative AI chips. Investors are looking to capitalize on the AI chip demand as tech giants like Google, Microsoft, and Meta increase spending on semiconductors required to power highly complex AI systems.

This year alone, Meta’s capital expenditure is expected to range between $66 billion and $72 billion to meet growing demand for AI. Microsoft is expected to spend about $30 billion in the current quarter. However, analysts say AMD is yet to benefit from the high AI spending like its competitor, NVIDIA.

“Investors may be paying closer attention to their data center segment as they roll out new products to compete with NVDA and go after more reliable customers,” Carson Group Chief Market Strategist Ryan Detrick said.

AMD’s data center revenue for the second quarter stood at $3.2 billion, representing a 14% growth from the $2.8 billion reported in the same period last year. In the first quarter, NVIDIA reported $39.11 billion in revenue from its data center unity, representing a 73% growth.

Effects of the US Chip Export Ban

Among the factors that affected the chip maker’s revenue was AMD’s MI308 China export ban. The California-based tech giant has been grappling with chip export restrictions introduced by the US government in a bid to limit Chinese access to America’s advanced AI technology.

“AI business revenue declined year over year as U.S. export restrictions effectively eliminated MI308 sales to China, and we began transitioning to our next generation,” AMD CEO Lisa Su told analysts during the earnings call.

According to AMD, the export ban on MI308 chips cost the chip maker about $800 million in revenue, resulting in a $155 million operating loss in the June quarter. In April 2025, Nvidia reported it would face a $5.5 billion charge in its 2026 first quarter as a result of the tight US chip export controls.

Last month, AMD said it expects to resume chip sales in China after the US government indicated that it would issue export licenses to chip makers. The company said its Q3 outlook does not include revenue from MI308 chips developed for the Chinese market.
AMD is also expected to grow its revenue from its new line of MI350 AI chips designed to compete with NVIDIA’s Blackwell chips. The MI350 series includes the MI350X and MI355X chips. These chips are designed to offer 35x higher inference capabilities and four times more AI compute performance.