AMD Stock Soars 14% in Five Days as AI Demand Drives Record Earnings

Advanced Micro Devices (AMD) recently reported significant growth in its first-quarter earnings, showcasing a robust performance amid global semiconductor challenges. As of May 13, AMD's stock surged by 4.01%, marking a five-day streak that culminated in a 14.03% increase over this period. Intraday trade saw its stock reach its highest point since March 2025. This optimistic trajectory was bolstered by AMD's quarterly report, revealing a net profit increase of 4.8 times year-on-year to $709 million and adjusted earnings per share of 96 cents, outperforming market predictions of 94 cents. Revenue climbed 36% to $7.44 billion, exceeding forecasts set at $7.13 billion.

AMD's data center business proved particularly lucrative, driven by sales of artificial intelligence graphics and central processing units, which brought in $3.7 billion—a notable 57% year-on-year increase, surpassing market expectations. Looking ahead, AMD projects second-quarter sales of approximately $7.4 billion with a gross margin of 43%, slightly ahead of market projections of $7.25 billion. However, due to new U.S. export restrictions on some of its AI chips, AMD anticipates additional costs amounting to $800 million.

The semiconductor industry faces a complex landscape due to fluctuating demand signals and geopolitical challenges. The recent U.S. tariffs and export limitations to China have injected uncertainty into the market, impacting earnings and forecasts for several chipmakers, including AMD. Despite its strong first-quarter results, AMD acknowledged potential financial strains later in the fiscal year due to these restrictions. The company has opted to withhold full-year guidance for 2026 until further clarity emerges.

This sentiment is echoed across the semiconductor sector, with companies like Marvell delaying investor events due to ongoing macroeconomic uncertainties. The industry remains pressured by potential geopolitical tensions and shifts in major countries' policies. As the semiconductor market navigates these headwinds, the demand for AI products continues to be a focal point, where tech giants such as AMD aim to capitalize amidst an evolving global tech ecosystem.