A month has gone by since the last earnings report for Advanced Micro Devices (AMD Quick QuoteAMD - Free Report) . Shares have added about 28.8% in that time frame, outperforming the S&P 500.

But investors have to be wondering, will the recent positive trend continue leading up to its next earnings release, or is Advanced Micro due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important catalysts.

AMD Q1 Earnings Beat Estimates, Revenues Rise on Data Center Demand

AMD delivered strong first-quarter 2026 results, fueled by accelerating demand for AI infrastructure. Non-GAAP earnings were $1.37 per share, up 42.7% year over year, and beat the Zacks Consensus Estimate by 5.4%. 

Revenues climbed 37.8% year over year to $10.25 billion and beat the Zacks Consensus Estimate by 5.3%. Data Center revenue surged 57.2% year over year to a record $5.78 billion, underscoring the scale of the company’s AI-driven momentum.

AMD Data Center Results Highlight CPU And GPU Momentum

Data Center segment revenues reflect strong demand for EPYC processors and the continued ramp of Instinct GPUs. 

Management emphasized that AI adoption is driving demand not just for accelerators, but also for high-performance CPUs used for orchestration and as head nodes in AI systems. The company also pointed to broadening engagement across cloud and enterprise customers as AI workloads scale.

AMD Shows Strength Across Client And Gaming

Client and Gaming revenues increased 22.6% year over year to $3.61 billion, though it declined 9% sequentially, consistent with seasonal patterns. Within the segment, Client revenues grew 25.8% year over year to $2.89 billion, supported by a richer product mix and ongoing share gains across consumer and commercial PCs.

Gaming revenues improved 11.3% year over year to $720 million, led by demand for Radeon GPUs, partially offset by lower semi-custom revenues at this stage of the console cycle. Management noted that it is planning for second-half demand to be pressured by higher memory and component costs, affecting both PCs and gaming.

AMD Embedded Returns To Growth With High Profitability

Embedded segment revenue rose 6.1% year over year to $873 million, reflecting strengthening demand across several end markets. 

The company also highlighted expanding design-win momentum, pointing to continued traction across aerospace and defense, communications, and test and measurement applications. This performance reinforced Embedded’s role as a stabilizing contributor as AMD scales higher-growth data center opportunities.

AMD Expands Profitability on Mix and Scale

On a non-GAAP basis, first-quarter 2026 gross margin expanded 180 basis points (bps) year over year to 55.4%, supported by a favorable mix shift toward data center products. 

At the same time, non-GAAP operating expenses increased to $3.15 billion, reflecting elevated investment in research & development and go-to-market activities tied to the AI roadmap. Management framed these investments as essential to support expanding customer engagements and sustained product cadence.

Adjusted EBITDA increased 40.5% year over year to $2.75 billion. Adjusted EBITDA margin expanded 50 bps year over year to 26.8%.

Non-GAAP operating income climbed to $2.54 billion, up 43% year over year, as AMD’s top-line growth translated into operating leverage. Data Center operating income increased to $1.60 billion (up 71.6% year over year), translating to a 27.7% operating margin versus 25.4% reported in the year-ago quarter. Despite a seasonally softer quarter sequentially, the Embedded segment remained highly profitable, generating $338 million of operating income, or a 39% operating margin.

Non-GAAP operating margin expanded 90 bps year over year to 24.8%.

AMD’s Balance Sheet & Cash Flow Details

As of March 28, 2026, AMD had cash, cash equivalents, and short-term investments of $12.35 billion compared with $10.55 billion as of Dec. 27, 2025. Total debt was $3.224 billion at the end of the reported quarter.

Operating cash flow was $2.96 billion in the first quarter of 2026 compared with $2.30 billion in the fourth quarter of 2025.

Free cash flow was $2.57 billion in the first quarter of 2026 compared with $2.08 billion in the fourth quarter of 2025. 

In the first quarter of 2026, AMD returned $1.1 billion to shareholders through its share repurchase program. The company has $9.2 billion remaining under its current authorization.

AMD Outlook Calls for Another Quarter of Strong Growth

For the second quarter of 2026, AMD expects revenues of approximately $11.2 billion, plus or minus $300 million, implying about 46% year-over-year growth at the midpoint and roughly 9% sequential growth. Year-over-year growth is expected to be driven by strong growth in the Data Center segment, growth in the Client and Gaming segment, and a double-digit growth in the Embedded segment. Sequentially, AMD expects revenues to be driven by double-digit growth in both the Data Center and the Embedded segments and modest growth in the Client and Gaming segments.

The company guided a non-GAAP gross margin of approximately 56%, signaling continued profitability strength even as it ramps next-generation platforms. Non-GAAP operating expenses are expected to be approximately $3.3 billion.

On the earnings call, management provided additional cadence around data center expansion, including expectations for strong year-over-year server CPU growth in the second quarter and a ramp in Helios-related activity in the second half of 2026. The company also discussed tightening supply-chain conditions and its efforts to expand wafer and back-end capacity in line with customer planning.

How Have Estimates Been Moving Since Then?

In the past month, investors have witnessed a upward trend in estimates revision.

The consensus estimate has shifted 12.68% due to these changes.

VGM Scores

Currently, Advanced Micro has a strong Growth Score of A, though it is lagging a lot on the Momentum Score front with a C. However, the stock was allocated a score of F on the value side, putting it in the bottom 20% quintile for this investment strategy.

Overall, the stock has an aggregate VGM Score of C. If you aren't focused on one strategy, this score is the one you should be interested in.

Outlook

Estimates have been broadly trending upward for the stock, and the magnitude of these revisions looks promising. Interestingly, Advanced Micro has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.

Performance of an Industry Player

Advanced Micro belongs to the Zacks Computer - Integrated Systems industry. Another stock from the same industry, IBM (IBM Quick QuoteIBM - Free Report) , has gained 35.4% over the past month. More than a month has passed since the company reported results for the quarter ended March 2026.

IBM reported revenues of $15.92 billion in the last reported quarter, representing a year-over-year change of +9.5%. EPS of $1.91 for the same period compares with $1.60 a year ago.

IBM is expected to post earnings of $2.95 per share for the current quarter, representing a year-over-year change of +5.4%. Over the last 30 days, the Zacks Consensus Estimate has changed +4.6%.

The overall direction and magnitude of estimate revisions translate into a Zacks Rank #3 (Hold) for IBM. Also, the stock has a VGM Score of D.