Super Micro Shares Fall on Poor Results, but Sales Forecast Raised

Bassyonni

ago 4 hours

Super Micro Shares Fall on Poor Results, but Sales Forecast Raised

Advanced Micro Devices (AMD) recently announced its third-quarter earnings, surpassing both revenue and earnings expectations. The company’s adjusted diluted earnings per share reached $1.20, exceeding the analyst consensus of $1.17. Revenue for the quarter hit $9.25 billion, well above the anticipated $8.74 billion, while also providing a strong sales forecast for the fourth quarter.

Q3 Performance Highlights

Adjusted diluted earnings per share: $1.20
Revenue: $9.25 billion
Data center revenue: $4.34 billion
Adjusted gross margin: 54%

AMD’s guidance for the upcoming quarter is set between $9.3 billion and $9.9 billion, higher than the expected $9.2 billion. The company maintained an adjusted gross margin estimate of 54.5%, aligning with analysts’ projections.

Market Reactions and Future Outlook

Despite these positive results, AMD shares dropped approximately 2% in after-hours trading. Analysts from Bloomberg Intelligence noted that the strong performance was likely driven by increased demand for PC and server CPUs, similar to trends seen at Intel. Furthermore, the ramp-up of graphics processing units (GPUs) is progressing faster than anticipated, aided by a resurgence in the gaming market.

Strategic Partnerships and Agreements

AMD has been active in forming significant partnerships, including a major deal with OpenAI expected to generate tens of billions in revenue. This announcement led to over 20 price target increases from Wall Street analysts within one day. Additionally, AMD entered an agreement with Oracle to deploy 50,000 of its new flagship chips in data centers starting in the latter half of next year.

Focus on the MI450 Chips

As AMD prepares for a conference call, analysts will seek information on the future sales prospects for the MI450 chips. Morgan Stanley analyst Joseph Moore emphasized that the upcoming rack scale solutions are crucial. While the OpenAI partnership is expected to accelerate growth, the company must still demonstrate better return on investment compared to competitors like NVIDIA. This includes addressing concerns about lower rack density and resolving potential ecosystem issues.

Stock Performance and Market Position

Ahead of the latest results, AMD was the third-best-performing member of the VanEck Semiconductor ETF in 2025, with its share price having more than doubled this year. Looking ahead, the market will watch closely how AMD capitalizes on its partnerships and the demand for its innovative chip offerings.