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Does AMD Still Have Room to Climb After Blowout Q1 Earnings?
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Key Takeaways
AMD posted Q1 revenue of $10.25B as Data Center sales climbed 57% year over year.
AMD is expanding Instinct AI accelerators and targeting AI data center revenue growth by 2027.
EPYC server CPU demand is rising as hyperscalers expand AI and cloud deployments.
Advanced Micro Devices Inc. (AMD - Free Report) came up with quarterly adjusted earnings of $1.37 per share, beating the Zacks Consensus Estimate of $1.3 per share. This compares to earnings of $0.96 per share a year ago. Quarterly revenues came in at $10.25 billion for the quarter ended March 2026, surpassing the Zacks Consensus Estimate by 4.09%. This compares to year-ago revenues of $7.44 billion. As a result, the stock price has soared year to date.
Image Source: Zacks Investment Research
Portfolio Expansion
AMD is benefiting from rising artificial intelligence (AI) infrastructure deployments that lift demand for EPYC server CPUs and Instinct accelerators across cloud and enterprise customers. The company is expanding its AI portfolio from Instinct MI355X to the MI450 series and the Helios rack-scale platform. In the first quarter of 2026, data center revenues rose 57% year over year to $5.8 billion, supported by higher EPYC and Instinct shipments.
Customer engagement around MI450 and Helios is widening, with management citing leading customer forecasts above initial expectations and a growing pipeline of large-scale deployments. Meta Platforms Inc. (META - Free Report) plans to deploy up to 6 gigawatts of Instinct GPUs, with the first 1-gigawatt deployment powered by a custom MI450-based GPU. AMD continues to target scaling data center AI revenues to tens of billions annually in 2027.
Growing Server CPU Market
EPYC adoption is being pulled by AI workloads that require more CPU orchestration, data movement and head nodes for accelerators. In the first quarter of 2026, server CPU revenues grew more than 50% year over year, and management expects server CPU revenues to grow more than 70% year over year in the second quarter of 2026 as supply ramps up.
AMD is on track to launch sixth-generation EPYC Venice later in 2026, with more customers validating platforms than prior generations. Management also raised its view of the server CPU market to greater than 35% annual growth, reaching over $120 billion by 2030.
Positive Catalysts
Hyperscalers continue to broaden EPYC deployments across general-purpose compute, data processing and AI head-node use cases. EPYC-powered cloud instances increased nearly 50% year over year to more than 1,600 in the first quarter of 2026.
During the first quarter, Amazon.com Inc.’s (AMZN - Free Report) AWS, Alphabet Inc.’s (GOOGL - Free Report) Google Cloud, Microsoft Corp.’s (MSFT - Free Report) Azure and Tencent announced new and expanded fifth-gen EPYC-powered instances, including Google Cloud H4D virtual machines for HPC and Azure offerings across multiple workload profiles.
In the enterprise segment, management cited record revenue and record sell-through in the first quarter of 2026, supported by new wins across industries and momentum in on-prem and hybrid deployments.
Solid Earnings Estimate Revisions
For 2026, the Zacks Consensus Estimate currently shows revenues of $48.02 billion, suggesting an improvement of 38.6% year over year and earnings per share of $7, indicating an increase of 67.9% year over year. The Zacks Consensus Estimate for the current year has improved 2.9% in the last seven days.
For 2027, the Zacks Consensus Estimate currently shows revenues of $67.84 billion, suggesting an improvement of 41.3% year over year and earnings per share of $10.98, indicating an increase of 56.9% year over year. The Zacks Consensus Estimate for next year has improved 6% in the last seven days.
AMD currently has a long-term (3-5 years) EPS growth rate of 54.4%, significantly above the S&P 500’s long-term EPS growth rate of 16.4%.
Image Source: Zacks Investment Research
Investment Thesis
Advanced Micro Devices currently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here. The stock has seen strong positive revisions for earnings and revenues in the last seven days for both 2026 and 2027.
This indicates that market participants are expecting the company to continue strong business execution in the near future. This along with the massive growth of the agentic AI-powered server CPU markets and the stock’s top Zacks Rank, indicates price upside over a long period.
Image Source: Zacks Investment Research
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Does AMD Still Have Room to Climb After Blowout Q1 Earnings?
Key Takeaways
Advanced Micro Devices Inc. (AMD - Free Report) came up with quarterly adjusted earnings of $1.37 per share, beating the Zacks Consensus Estimate of $1.3 per share. This compares to earnings of $0.96 per share a year ago. Quarterly revenues came in at $10.25 billion for the quarter ended March 2026, surpassing the Zacks Consensus Estimate by 4.09%. This compares to year-ago revenues of $7.44 billion. As a result, the stock price has soared year to date.
Image Source: Zacks Investment Research
Portfolio Expansion
AMD is benefiting from rising artificial intelligence (AI) infrastructure deployments that lift demand for EPYC server CPUs and Instinct accelerators across cloud and enterprise customers. The company is expanding its AI portfolio from Instinct MI355X to the MI450 series and the Helios rack-scale platform. In the first quarter of 2026, data center revenues rose 57% year over year to $5.8 billion, supported by higher EPYC and Instinct shipments.
Customer engagement around MI450 and Helios is widening, with management citing leading customer forecasts above initial expectations and a growing pipeline of large-scale deployments. Meta Platforms Inc. (META - Free Report) plans to deploy up to 6 gigawatts of Instinct GPUs, with the first 1-gigawatt deployment powered by a custom MI450-based GPU. AMD continues to target scaling data center AI revenues to tens of billions annually in 2027.
Growing Server CPU Market
EPYC adoption is being pulled by AI workloads that require more CPU orchestration, data movement and head nodes for accelerators. In the first quarter of 2026, server CPU revenues grew more than 50% year over year, and management expects server CPU revenues to grow more than 70% year over year in the second quarter of 2026 as supply ramps up.
AMD is on track to launch sixth-generation EPYC Venice later in 2026, with more customers validating platforms than prior generations. Management also raised its view of the server CPU market to greater than 35% annual growth, reaching over $120 billion by 2030.
Positive Catalysts
Hyperscalers continue to broaden EPYC deployments across general-purpose compute, data processing and AI head-node use cases. EPYC-powered cloud instances increased nearly 50% year over year to more than 1,600 in the first quarter of 2026.
During the first quarter, Amazon.com Inc.’s (AMZN - Free Report) AWS, Alphabet Inc.’s (GOOGL - Free Report) Google Cloud, Microsoft Corp.’s (MSFT - Free Report) Azure and Tencent announced new and expanded fifth-gen EPYC-powered instances, including Google Cloud H4D virtual machines for HPC and Azure offerings across multiple workload profiles.
In the enterprise segment, management cited record revenue and record sell-through in the first quarter of 2026, supported by new wins across industries and momentum in on-prem and hybrid deployments.
Solid Earnings Estimate Revisions
For 2026, the Zacks Consensus Estimate currently shows revenues of $48.02 billion, suggesting an improvement of 38.6% year over year and earnings per share of $7, indicating an increase of 67.9% year over year. The Zacks Consensus Estimate for the current year has improved 2.9% in the last seven days.
For 2027, the Zacks Consensus Estimate currently shows revenues of $67.84 billion, suggesting an improvement of 41.3% year over year and earnings per share of $10.98, indicating an increase of 56.9% year over year. The Zacks Consensus Estimate for next year has improved 6% in the last seven days.
AMD currently has a long-term (3-5 years) EPS growth rate of 54.4%, significantly above the S&P 500’s long-term EPS growth rate of 16.4%.
Image Source: Zacks Investment Research
Investment Thesis
Advanced Micro Devices currently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here. The stock has seen strong positive revisions for earnings and revenues in the last seven days for both 2026 and 2027.
This indicates that market participants are expecting the company to continue strong business execution in the near future. This along with the massive growth of the agentic AI-powered server CPU markets and the stock’s top Zacks Rank, indicates price upside over a long period.
Image Source: Zacks Investment Research