SuperworthAdvanced Micro Devices, Inc. AMD
- Market cap
- $1.1T
- PE
- 166×
- 10y median 109×
- Forward PE
- Price to sales
- 25.5×
- EV/EBIT
- 161×
- Revenue, 12 months
- $41.3B
- +40% on a year ago
- Net margin
- 15.6%
- Free cash flow yield
- 0.8%
Priced for the AI ramp to land on time
A trillion dollars at nearly 58 times forward earnings, just as its biggest GPU ramp starts to ship
The richest price on sales in ten years
AMD trades at 25.7 times the last twelve months of sales, its highest in ten years, against a median of 7.8. A year ago it was about 9. Today's price assumes revenue keeps growing fast for years. Consensus has 68.3 billion dollars of sales over the next four quarters AMD will report, 65% more than the last twelve months. Even on those sales it trades at about 15.5 times.
Almost all of the climb came in the last six months
AMD closed at 649.42 dollars on October 6, the high of this chart. That is up 219% in a year, and 96% of the gain came in the last six months. Its AI deals are sized in gigawatts, the power of the computing a customer buys: up to 6 each for OpenAI and Meta, up to 2 for Anthropic starting in the first half of 2027, and up to 1 for HUMAIN by 2030.
Sales growth has sped up every quarter since early 2024
Revenue over twelve months went from 22.7 billion dollars in December 2023 to 41.3 billion. Growth on a year earlier rose every quarter, from minus 1.2% in March 2024 to 39.5% now. The mix is shifting: in the June quarter, data center sales more than doubled to 6.7 billion, 58% of the total.
Gross margin is at a ten year high, and AMD expects it to hold
In the twelve months to June 2023, where this chart starts, gross margin was 43.7% and operating margin minus 1.7%. Now they are 53.2% and 15.7%, and gross margin is a ten year high against a 44.5% median. Reported profit sits below AMD's adjusted figures, mostly from amortization, a non-cash cost of past deals, mainly Xilinx. AMD expects September's adjusted gross margin to hold at about June's 56%.
Consensus sees quarterly earnings more than triple by mid 2028
Reported EPS went from 0.41 in the December 2023 quarter to 1.38 in June. Adjusted, June was 1.66. Consensus also leaves out amortization and stock pay. It has 1.94 for the September quarter, rising to 5.57 by mid 2028, more than three times June. The 13 analysts that far out range from 4.65 to 6.45. Those figures are per share, and the warrants in the next step could add up to 20% more shares.
The bear case: customers paid partly in AMD stock
OpenAI and Meta each hold a warrant, a right to buy up to 160 million new AMD shares cheaply as their purchases grow. Together that is about 20% on top of today's 1.63 billion. AMD will also invest up to 5 billion dollars in Anthropic. The ramp leans on three buyers and Helios, AMD's full-rack AI system. December quarter sales estimates span 15.0 to 18.5 billion dollars. And Nvidia will defend its lead.
At nearly 58 times forward earnings, the ramp has to arrive on schedule
Consensus puts AMD at 57.6 times the next four quarters' earnings, higher than 96% of the last ten years (median 37.7). Peers sit at 30.6, and the four quarters after give 32.3 times. Before September 22 the line is rebuilt with hindsight. AMD is due to report November 3, against a guide of about 13 billion dollars and a 13.06 billion consensus. A beat with MI450 on time supports the price. A miss threatens it.
What has happened lately
- AMD, AMD, Cisco and HUMAIN go live in Saudi Arabia, targeting up to 1 GW of AMD systems by 2030Adds a sovereign AI customer: MI355X systems are live now, with up to 250 MW of MI400-series capacity planned from 2027.
- AMD, AMD acquires AI inference chip startup TaalasUndisclosed-price deal adding model-specific inference silicon to the Instinct roadmap as inference becomes the larger share of AI compute spending.
- AMD, AMD reports second quarter 2026 financial resultsRevenue $11.5B, up 50%, with data center up 107% to $6.7B; adjusted EPS $1.66 at a 56% adjusted gross margin; Q3 guide about $13B, plus or minus $300M.
- AMD, AMD and Anthropic agree to deploy up to 2 gigawatts of MI450 GPUs; AMD to invest up to $5 billionA third multi-gigawatt AI customer, with the first gigawatt from the first half of 2027, paired with an AMD equity commitment of up to $5B in Anthropic.
Headlines link to the original source.
Charts
Financials
| Income statement | Q4 FY23 | Q1 FY24 | Q2 FY24 | Q3 FY24 | Q4 FY24 | Q1 FY25 | Q2 FY25 | Q3 FY25 | Q4 FY25 | Q1 FY26 | Q2 FY26 |
|---|---|---|---|---|---|---|---|---|---|---|---|
| $6.2B | $5.5B | $5.8B | $6.8B | $7.7B+24% | $7.4B+36% | $7.7B+32% | $9.2B+36% | $10.3B+34% | $10.3B+38% | $11.5B+50% | |
| Cost of revenue | $3.3B | $2.9B | $3B | $3.4B | $3.8B+16% | $3.7B+27% | $4.6B+56% | $4.5B+31% | $4.7B+24% | $4.8B+31% | $5.3B+15% |
| Gross profit | $2.9B | $2.6B | $2.9B | $3.4B | $3.9B+33% | $3.7B+46% | $3.1B+7% | $4.8B+40% | $5.6B+44% | $5.4B+45% | $6.2B+103% |
| R&D | $1.5B | $1.5B | $1.6B | $1.6B | $1.7B+13% | $1.7B+13% | $1.9B+20% | $2.1B+31% | $2.3B+36% | $2.4B+39% | $2.5B+34% |
| SG&A | $610M | $607M | $640M | $707M | $781M+28% | $886M+46% | $991M+55% | $1.1B+51% | $1.2B+53% | $1.3B+41% | $1.4B+41% |
| $342M | $36M | $269M | $724M | $871M+155% | $806M+2139% | −$134M | $1.3B+75% | $1.8B+101% | $1.5B+83% | $2B | |
| Interest expense | $27M | $25M | $25M | $23M | $19M−30% | $20M−20% | $38M+52% | $37M+61% | $36M+90% | $37M+85% | $37M−3% |
| Pre-tax income | — | $64M | $299M | $737M | — | $825M+1189% | −$74M | $1.3B+78% | — | $1.6B+94% | $2.6B |
| −$297M | −$52M | $41M | −$27M | $419M | $123M | −$834M | $153M | $455M+9% | $238M+94% | $252M | |
| Net income | $667M | $123M | $265M | $771M | $482M−28% | $709M+476% | $872M+229% | $1.2B+61% | $1.5B+214% | $1.4B+95% | $2.3B+163% |
| $0.41 | $0.07 | $0.16 | $0.47 | $0.30−27% | $0.44+529% | $0.54+238% | $0.75+60% | $0.92+207% | $0.84+91% | $1.38+156% | |
| 1.6B | 1.6B | 1.6B | 1.6B | 1.6B+0% | 1.6B−1% | 1.6B−0% | 1.6B+0% | 1.6B+1% | 1.6B+2% | 1.7B+2% |
From each company's 10-Q and 10-K filings. Fiscal years are four fiscal quarters added up; balance sheet lines are as of the period's end. Growth is on the same period a year earlier.
Estimates
Next earnings report: .
Analyst consensus for the next eight quarters, with the range from the lowest to the highest estimate, is part of Superworth Pro.
Peers
Companies in Semiconductors within ten times Advanced Micro Devices's size, closest in size first.
| Company | Market cap | PE | Its 10y median PE | Fwd PE | P/S | Revenue growth | Net margin |
|---|---|---|---|---|---|---|---|
| AMDAdvanced Micro Devices, Inc. | $1.1T | 166× | 109× | 25.5× | +40% | 15.6% | |
| MUMicron Technology, Inc. | $1.2T | 14.7× | 17.4× | 9.2× | +256% | 63.8% | |
| AVGOBroadcom Inc. | $1.8T | 48.1× | 44.4× | 20.2× | +49% | 42.9% | |
| AMATApplied Materials, Inc. | $413.2B | 44.9× | 19.7× | 13.4× | +8% | 30.1% | |
| LRCXLam Research Corporation | $412.3B | 57.2× | 21.0× | 17.7× | +26% | 31.3% | |
| TXNTexas Instruments Incorporated | $263.9B | 44.0× | 24.1× | 13.6× | +17% | 31.1% | |
| KLACKLA Corporation | $257.2B | 53.7× | 23.8× | 18.9× | +12% | 35.6% | |
| MRVLMarvell Technology, Inc. | $249.6B | 94.0× | 31.6× | 26.4× | +31% | 27.9% | |
| ADIAnalog Devices, Inc. | $198.7B | 48.6× | 39.1× | 14.3× | +34% | 29.8% | |
| NVDANVIDIA Corporation | $5.7T | 30.0× | 53.9× | 18.9× | +83% | 63.7% | |
| QCOMQUALCOMM Incorporated | $186B | 20.2× | 20.2× | 4.2× | +2% | 21.0% | |
| Peer median | $338.1B | 46.5× | 23.9× | 16.0× | +28% | 31.2% |
About
- Chief executive
- Lisa Su, since 2014Joined 2012, CEO since 2014.
- Industry
- Semiconductors
- Sector
- Technology
Valuation data, not investment advice. Prices as of .