AMD stock falls over 16 percent despite beating Q4 earnings estimates

TLDR AMD stock declined more than 16 percent after the company released its Q4 earnings report. The company reported earnings per share of $1.53 on revenue of $10.3 billion which beat analyst expectations. Despite strong results in data center and PC segments investors expected higher performance and guidance. AMD projected Q1 revenue between $9.5 billion and $10.1 billion which exceeded Street estimates but fell short of hopes. The gaming segment missed expectations with revenue of $843 million against a forecast of $855 million. Advanced Micro Devices (AMD) saw its stock drop more than 16% on Wednesday, even after it surpassed Q4 expectations, raised guidance, and reported growth in its key businesses, as investors reacted to what some considered modest projections compared to high anticipation. Q4 Results Top Forecasts But Disappoint Market Hopes AMD posted Q4 earnings per share of $1.53 on $10.3 billion revenue, exceeding estimates of $1.32 and $9.6 billion, respectively. The company’s revenue rose from $7.7 billion in the same period last year, showing strong year-over-year growth. However, investors appeared to want even higher beats given the stock’s sharp rally over the past year. The stock had climbed over 112% in the last 12 months, outpacing Nvidia’s 54% growth during that same period. Expectations were high as many expected AMD to capture more market share from Nvidia in AI and data center segments. While AMD delivered strong numbers, market response indicated it fell short of loftier hopes. In the data center segment, AMD reported $5.4 billion in revenue, above expectations of $4.97 billion. The PC client unit generated $3.1 billion versus projections of $2.9 billion, also beating estimates. Its gaming division reported $843 million, just under the $855 million analysts expected. AMD Stock Drops as Guidance Fails to Satisfy Lofty Expectations Despite raising its Q1 forecast, AMD stock declined sharply following the earnings release. The company said ...