AMD Stock Mixed Reaction: Earnings Beat Offset by $1.5B China Revenue Hit

AMD just surprised Wall Street. It reported strong earnings this quarter. That sounds great, right? But there’s a twist. While profits went up, AMD stock lost a big chunk of money, $1.5 billion, from China. That’s not a small change.

We all know China plays a big role in the tech world. For AMD, it’s one of the largest markets. But rising tensions between the U.S. and China are now hurting sales. This news hit the stock hard. Some investors cheered the profit. Others worried about the future.

So, what’s really going on with AMD? Should we be excited or concerned? Let’s break it down one step at a time.

AMD Stock Performance

Advanced Micro Devices (AMD) shared its first-quarter 2025 results. The company did well. Revenue was $7.44 billion. That’s 36% more than last year.

Earnings per share (EPS) were $0.96. Experts had guessed $0.94. So AMD beat that.

The data center part of the business helped a lot. It made $3.7 billion. That’s 57% more than last year.

Big companies like Microsoft and Meta bought many EPYC CPUs and Instinct GPUs. The PC part of AMD also did great. It made $2.3 billion. That’s 68% more than before. Ryzen chips were a big reason.

Analysts liked what they saw. They praised AMD’s strong products and growth in AI and data centers.

$1.5 Billion China Revenue Hit

Even with strong earnings, AMD has some problems. New U.S. rules limit sales of AI chips to China. Because of this, AMD may lose $1.5 billion in 2025.

China brings in over 24% of AMD’s total money. So, it’s a very important market. These rules may hurt AMD’s earnings in the second half of the year.

The company also said its profit margin may drop by 11 points. It could fall to 43%.

In a call, AMD leaders talked about these issues. They said the company has many strong products. They also have a smart plan to handle the changes.

Market Reaction

After the AMD’s earnings report, AMD’s stock moved up and down. At first, it went up by 1.7% in after-hours trading. The price hit $100.32. That added to an 18% gain for the year.

But news about the $1.5 billion loss from China made some investors worry. Strong earnings were good news. But the China issue was not. This mix caused confusion.

Some experts still felt good about AMD. They liked the company’s strong sales and future plans. Others were careful. They worried about what the export rules could mean later on.

Geopolitical Risks and China Exposure

Tension between the U.S. and China is a big risk for AMD. New rules now need special licenses to send AI chips to China. This directly affects AMD’s work there.

China gives a big part of AMD’s total sales. So, these rules are a real challenge.

AMD is trying to fix this. The company wants to sell more in other countries. It’s also changing its supply chain. This will help AMD rely less on one region.

Strategic Moves and Future Outlook

Looking ahead, AMD is staying focused on new ideas and growth. The company is putting money into AI, custom chips, and servers to stay strong.

New products like the MI350 AI chips will help grow the business.

AMD is also working with big tech companies. It wants to keep building better data centers and AI tools. CEO Lisa Su said the company will follow its plan. She promised to keep giving value to its investors.

Investor Takeaways

For investors, AMD has both good and bad sides. The good news is strong earnings and new, smart products. The AI and data center markets are also growing fast.

But there are risks too. Trouble with China and lost sales could hurt the company. Short-term traders may see ups and downs in the stock. Long-term investors should look at AMD’s smart plans and strong place in the market before deciding.

Closing 

AMD did well in the first quarter of 2025. This shows its strength in making smart products and moving fast in the market. But there are problems too. Trade rules and tension with China are big hurdles. Still, AMD has a strong plan and good products. These can help the company grow.

Investors should watch U.S.-China news and see how AMD follows its plan. That will help tell what’s next for the company in tech.

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Disclaimer:

This content is for informational purposes only and not financial advice. Always conduct your research.