Investment firm Susquehanna said that when AMD announces first-quarter results later this week, it may provide financial estimates that meet expectations or are “slightly weak”.
Zhitong Finance learned that investment company Susquehanna said that when AMD (AMD.US) announces first-quarter results later this week, it may provide financial estimates that meet expectations or are “slightly weak” because its core business is still dealing with the weak PC market. The agency's analyst Christopher Rolland said that the PC market had mixed feelings, and recent surveys showed that laptop production and sales in the first quarter were better than expected. However, the survey also showed that AMD's share in the laptop and desktop markets may have declined. Rolland maintained AMD's “positive” rating, but lowered the target price to $185.
Rolland said AMD's AI efforts, including its MI300 AI accelerator, could benefit amid concerns about its core business. However, Rolland added that the boost from MI300 is probably a “necessary condition” for the stock to rise, especially since Nvidia (NVDA.US) held the GTC conference last month, investor sentiment has cooled down. Bullets' expectations for the MI300 are as high as $8 billion, while Rolland estimates MI300's revenue this year to be around $5 billion.
The traditional data center market is still struggling as GPUs crowd out CPUs, but AMD believes there will be a “moderate recovery” in spending in the second half of the year, partly due to an increase in market share. Intel (INTC.US) said last week that it is expected that the data center CPU market will also recover in the second half of the year.
Rolland said AMD's programmable and embedded division could be boosted as the company “discontinued” a range of field programmable gate array products, which could cause customers to buy in the final stages, boosting otherwise weak performance. Analysts generally expect AMD to report earnings of US$0.61 per share and revenue of US$5.45 billion.
Wall Street analysts are mostly wary of AMD. Seeking Alpha's analysts rated it “hold,” while Wall Street analysts rated it “buy.”