Advanced Micro Devices (AMD) will release its fiscal Q2 earnings report this week, which might show an upbeat earnings per share. Moreover, the management will host a management call from where a future guideline for this company can be found.
AMD Earnings Forecast
As per the current expectation, AMD will likely show non-GAAP earnings per share at $0.68 against revenue of $5.7 billion. Therefore, the result might be higher than last year's EPF of $0.58 against revenue of $5.4 billion.
Additionally, the company has a strong growth forecast for its Personal Computer PC shipment in the second quarter of 2024. Despite a shipment decline, the global Personal Computer market experienced 3% growth in the first quarter.
In the future, AMD is likely to regulate its MI325X accelerator, which might be a key revenue generator for upcoming quarters. As per the CEO of AMD, the AI chip mentioned above works 30% faster than Nvidia's (NVDA) H200.
AMD Data Center Growth
Among revenue segments, investors will closely monitor data center revenue as it relates to the ongoing growth in AI demand.
Data center revenue peaked at a record high of $2.3 billion in the first quarter. The 80% surge in the result from the previous year was driven by M1300 chips, which are used in data centers.
According to current analysts, data center revenue could reach $2.79 billion, a record high for this stock.
According to consensus estimates from Visible Alpha, analysts expect data center revenue to be $2.79 billion, a quarterly record high for the segment.
Analysts Opinion On AMD Stock
Nvidia (NVDA) and Broadcom are popular AI stocks among investors, while AMD is considered unpopular.
According to a recent report from Visible Alpha, AMD's forecasted 3rd quarter revenue is $6.60 billion. If the company beats the expected earnings, this could be a positive catalyst for the stock.
Another projection from Goldman Sachs said that AMD will disclose the earnings report in line with the expectation. The data center revenue could come at $4.5 billion, where any upbeat result could create a positive investor sentiment.
Despite the positive forecast, AMD stock is trading 5% down from the yearly opening.
AMD Stock Forecast Technical Analysis
In the daily chart of AMD stock price, the broader market direction is corrective, where the most recent price faces decent selling pressure with a valid buy-side liquidity sweep. In this context, a downside continuation is potent, but a valid price action could create a decent bearish opportunity.
In the volume structure, the largest activity level since November 2023 is at 163.11, which is above the current price. This is a sign that the bearish selling pressure from the CHoCH formation at the 174.67 level came with a valid institution's interest. In that case, a valid bullish recovery is needed before aiming for a long-term bullish possibility.
As the dynamic 20-day EMA and 100-day SMA are above the current price with a bearish slope, investors should closely monitor how the price reacts after having a minor upward recovery. A bearish reversal with a valid candlestick formation from the 156.50 to 175.00 zone could lower the price toward the 100.00 psychological line.
On the other hand, the current price is trading below the 50% Fibonacci Retracement level from the existing swing. In that case, a valid recovery with a stable market above the 175.00 level could be a potential long opportunity, aiming for the 227.42 resistance level.
