Chipmaker AMD Soars 30% in Two Weeks
Advanced Micro Devices (AMD:US) shares surged over 30% in the last few weeks after the selloff prompted by the company’s weaker-than-expected forecast for the second quarter sparked a dip-buying opportunity.
Earlier in May, AMD shares dropped multi-week lows after the chipmaker offered a softer-than-expected outlook for the current quarter given weakening demand for PCs.
AMD said it expects to report revenue of $5.3 billion for its second quarter, missing the consensus for sales of $5.51 billion. For the first quarter, the company said its revenue fell 9.1% year-over-year to $5.35 billion. On the other hand, the adjusted profit per share came in at $0.60, beating the $0.57 expected from analysts.
AMD is experiencing a slowdown in its flagship Data Center business. This business segment attracted $1.3 billion in Q1 revenue, widely missing the $1.46 billion analyst target.
“We executed very well in the first quarter as we delivered better than expected revenue and earnings in a mixed demand environment,” said AMD Chair and CEO Dr. Lisa Su.
"For the second quarter we expect sequential growth in our Data Center and Client segments offset by modest declines in our Gaming and Embedded segments. We remain confident in our growth in the second half of the year as the PC and server markets strengthen and our new products ramp.”
However, the sell-off that was sparked by the soft forecast was seen as an attractive opportunity to buy AMD shares. A rally of over 30% followed in the next 2 weeks, prompting the stock to trade at the highest levels since June last year.
Congress members Josh Gottheimer, Ro Khanna, and John Curtis were all trading the stock in recent months.
