AMD’s Q3 2024 Earnings: What to Expect and Key Takeaways

Advanced Micro Devices (AMD) is set to report its third-quarter 2024 earnings after the closing bell on Tuesday, October 29, and analysts are anticipating significant growth. According to Visible Alpha, revenue is expected to reach $6.71 billion, a nearly 16% increase year-over-year from $5.8 billion in Q3 2023. Net income is projected to more than double to $815.76 million, or 50 cents per share, compared to $299 million or 18 cents per share in the same period last year.

A key metric to watch is AMD’s data center revenue, which surged in the second quarter to a record $2.8 billion, driven by strong demand for the company’s artificial intelligence (AI) chips. Analysts expect this trend to continue, with data center revenue anticipated to rise to a fresh high of $3.52 billion in the third quarter. CEO Lisa Su has highlighted that the company expects strong revenue growth in the second half of the year, led by demand for Instinct, EPYC, and Ryzen processors.

Investors will also be keen on commentary regarding AMD’s artificial intelligence expectations, following the company’s Advancing AI event earlier this month. Although AMD launched its next generation of AI chips at the event, it did not raise its AI sales guidance or announce any new large customers, which some investors had hoped for. Jefferies analysts suggest that these updates might be provided during the earnings call.

The market sentiment around AMD is positive, with over 80% of the 16 analysts tracked by Visible Alpha having a “buy” or equivalent rating for the stock. The average price target is $192.13, implying close to an 18% upside from the current price. Shares of AMD have already gained about 11% so far in 2024.

In addition to the financial metrics, the performance of AMD’s MI300 series processors will be closely watched. Analysts believe that the MI300 series could potentially double the company’s overall size, making it a crucial aspect of the upcoming report.