Michael Kramer: How to Analyse AMD Before Earnings
AMD’s market capitalisation has risen since late 2022, climbing from roughly $90 billion to a 2026 peak of just below $950 billion before falling to $851 billion as of 24 July 2026.
AMD’s market capitalisation has risen since late 2022, climbing from roughly $90 billion to a 2026 peak of just below $950 billion before falling to $851 billion as of 24 July 2026. Revenue is generated through its four business units: Data Center, Client, Gaming and Embedded. The Data Center business accounted for 56.3% of total revenue in the first quarter of 2026 and was the fastest-growing unit.
(Source: LSEG, as of 24 July 2026. Calculations based on LSEG data)
(Past performance is not a reliable indicator of future results)
Earnings History
Across the 21 quarters shown, AMD’s revenue exceeded analysts’ consensus mean estimate in 20 quarters, while EPS exceeded the consensus mean estimate in 18. Among the positive surprises, EPS was an average of 7.6% above consensus, while revenue was an average of 3.4% above consensus.
(Source: LSEG, as of 24 July 2026. Calculations based on LSEG data)
(Past performance is not a reliable indicator of future results)
Segment Growth
In the first quarter of 2026, Data Center revenue grew 57.2% year on year, followed by Client revenue at 25.8%, Gaming at 11.3% and Embedded at 6.1%. In 2025, Data Center and Client revenue together accounted for approximately 79% of AMD’s total revenue.
(Source: LSEG, as of 25 July 2026. Calculations based on LSEG data)
(Past performance is not a reliable indicator of future results)
Data Center represented 56.3% of AMD’s total revenue in the first quarter of 2026. It stood at 42.2% in the second quarter of 2025 and rose in each of the following three quarters. Over the full period shown, its share more than doubled from 24.2% in the first quarter of 2023 to 56.3% in the first quarter of 2026.
(Source: LSEG, as of 25 July 2026. Calculations based on LSEG data)
(Past performance is not a reliable indicator of future results)
Free Cash Flow
AMD’s trailing-12-month free cash flow rose from $1.12 billion in the fourth quarter of 2023 to $7.36 billion in the first quarter of 2026. In the first quarter of 2026, quarterly free cash flow more than tripled to approximately $2.6 billion from $727 million the year prior.
(Source: LSEG, as of 24 July 2026. Calculations based on LSEG data)
(Past performance is not a reliable indicator of future results)
Options-Implied Earnings Range
Option prices can be used to calculate an implied trading range around an earnings announcement. Across the 12 announcements shown, 10-day at-the-money implied volatility produced an average one-standard-deviation range of ±12.4%, while the average absolute realised next-session move was 8.0%. The next-session share-price move remained within the calculated range in ten cases and was outside it in two.
The implied range was estimated using the 10-day at-the-money implied volatility observed at the last close before each report, scaled to the option’s 10-day term using implied volatility × √(10/365) and applied to the share price. This produces a one-standard-deviation range derived from option prices. It does not represent a forecast or indicate the direction of the share-price move.
(Source: LSEG (price data) and VolVue (implied volatility), as of 24 July 2026. Calculations based on LSEG and VolVue data)
(Past performance is not a reliable indicator of future results)
Valuation Metrics
As of 24 July 2026, AMD’s forward price-to-earnings ratio, based on analysts’ estimates for the next 12 months, was 47.2. From March 2023 to July 2026, the average P/E was 32.3, and the median was 31.2, placing the 24 July observation above both measures for the period.
Historical valuation multiples provide context for how the market has priced the company over time. These comparisons do not indicate whether the shares are currently overvalued or undervalued.
(Source: LSEG, as of 24 July 2026. Calculations based on LSEG data)
(Past performance is not a reliable indicator of future results)
As of 24 July 2026, AMD’s forward price-to-sales ratio, based on analysts’ consensus mean revenue estimates for the next 12 months, was 14.4. From March 2023 to July 2026, the average P/S ratio was 7.6, and the median was 7.2, placing the 24 July observation above both measures for the period.
(Source: LSEG, as of 24 July 2026. Calculations based on LSEG data)
(Past performance is not a reliable indicator of future results)
Over the period shown, AMD’s trailing-12-month EPS recorded an average year-on-year growth rate of 40%, with a median of 25%. Revenue growth averaged 33%, with a median of 32%.
In the first quarter of 2026, EPS growth of 25.1% was below the historical average but slightly above the median. Revenue growth of 35.0% was above both its historical average and median.
(Source: LSEG, as of 24 July 2026. Calculations based on LSEG data)
(Past performance is not a reliable indicator of future results)
Conclusion
AMD’s earnings history, segment growth, revenue mix, free cash flow, options-implied ranges and valuation multiples provide historical context ahead of the company’s fiscal second-quarter results.
The 24 July observations for forward P/E and P/S were above their respective historical averages and medians for the periods shown. These measures describe historical observations and do not provide a forecast for the next earnings announcement. Past performance is not a reliable indicator of future results.
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