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Advanced Micro Devices, Inc. shares drop 5% despite reporting record revenue and beating second-quarter earnings expectations

Advanced Micro Devices, Inc. shares fell 5% on Wednesday following the release of second-quarter earnings that exceeded Wall Street expectations. The company reported revenue of $11.54 billion, a 50% increase from the previous year, and adjusted earnings per share of $1.66, surpassing the $1.62 expected by analysts. While the results were positive, the stock price declined because the performance was not as exceptional as investors had anticipated for a stock trading at a high multiple. Dr. Lisa Su, the CEO of Advanced Micro Devices, Inc., noted that the data center unit is driving significant growth, with sales reaching $6.7 billion. The company expects to ship its first rack AI system, Helios, this quarter to major clients like Meta and OpenAI. Despite the growth in AI and data center segments, Dr. Lisa Su warned of a potential softening in the PC market due to rising component costs. The company also reported a significant increase in capital expenditures, reaching $808 million for the quarter.

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