AMD reported impressive Q2 results, with record sales in server processors and gaming chips driving revenue to $7.69 billion, surpassing expectations of $7.42 billion. Despite this, shares fell 6.4% as investors reacted to flat gross margins and rising operational costs. Analysts remain bullish, with several firms raising price targets to as high as $230, citing AMD’s "beat-and-raise" performance and strong Q3 guidance of $8.7 billion in projected revenue.
GPU Demand Offsets China Concerns
The MI350 GPU series is expected to fuel record Q3 GPU sales, with pre-orders stretching into 2026. Seven of the top ten AI firms now use AMD’s Instinct chips, positioning the company for potential 10% GPU market share by 2029. While delays in MI308 exports to China pose risks, the MI355 lineup is projected to drive 60% quarterly growth in data center GPUs. A prominent investment fund also made a $40 million AMD purchase, signaling long-term confidence.