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Takeaways
- AMD will report its first quarter results after the close of the market on Tuesday.
- Several analysts have lowered price targets for the chipmaker 's shares following tightened export restrictions from the Trump administration last month.
- Citi analysts said that the resilience of AI spending by Big Tech firms was a positive sign in the long-term.
After the closing bell on Tuesday, Advanced Micro Devices will report its quarterly results. Several analysts have lowered the price targets of their stocks in recent weeks due to tighter restrictions placed on U.S. chips exported to China.
Bank of America Securities dropped its price target from $110 to $105 after claiming that the new licensing restrictions from the Trump Administration effectively ban the shipment of AMD’s MI308 processors. AMD warned that if it doesn’t secure a license, it could be charged $800 million. Nvidia, a competitor of AMD, has warned that it could be charged $5.5 billion for its H20 chips.
Wedbush Securities and Deutsche Bank analysts both reduced their AMD price targets to $115 in late April from $150.
Visible Alpha tracks analysts who are following AMD. The consensus price goal is $123.50. That’s a 25% premium to Friday’s closing price, which was $98.80. Six out of 12 analysts are rating the stock “buy” compared to five ratings “hold” and only one “sell”. AMD stock lost nearly a quarter of its value by 2025.
Citi: AI Spending is a Positive Sign
Citi analysts wrote that despite an uncertain tariff environment on Thursday, “it seems that spending on AI continues unabated.” Meta Platforms (META), Microsoft (MSFT) Alphabet (GOOGL), and Meta Platforms (META), reiterated their AI spending targets of $75 billion and $80 billion respectively.
"AI infrastructure buildouts remain as key priorities for hyperscalers with the companies’ willingness to absorb the costs of tariffs," Citi said. "We view this as positive for AI-exposed stocks," including AMD, they wrote.
Analysts expect AMD will report a first-quarter revenue figure of $7.13 Billion, up 30% from the year before, along with adjusted earnings of 1.55 Billion or 94 cents a share, which is over 50% higher than last year’s quarter. Data center sales will rise by 55%, to $3.63billion.
