The data indicates that semiconductor industry is at the heart of the artificial intelligence (AI) revolution.
Meanwhile, Without the thousands of graphics cessing units (GPUs) that fill each specialized data center, the most advanced AI software applications wouldn't be possible. Advanced Micro Devices (AMD 2.
At the same time, 40%) has become a top supplier of GPUs, but it also supplies industry-leading AI chips for personal computers.
This could be a major growth area as more AI workloads shift onto devices to create a more convenient user experience.
AMD is scheduled to release its financial results for the second quarter of 2025 ( June 30) on Aug, considering recent developments.
Management's forecast points to another strong report, and CEO Lisa Su is ly to give investors a gress on the company's hardware ducts, including the MI355X and MI400 data center GPUs.
With AMD stock up 30% this year already, should investors buy it ahead of the upcoming report, or is the potential good news already priced in.
Image source: Advanced Micro Devices, in today's financial world. AMD is chasing Nvidia in the data center space Nvidia's (NVDA 2.
06%) H100 GPU was the hottest data center chip for AI workloads in 2023, earning the company a 98% market, in light of current trends.
On the other hand, AMD was late to the party, launching its H100 competitor -- the MI300X GPU -- in December of that year.
At the same time, However, it successfully attracted many of Nvidia's top customers including Oracle, Meta Platforms, and Microsoft.
Nvidia remains a step ahead ing the launch of its Blackwell GPU architecture in 2024, and Blackwell Ultra this year, amid market uncertainty.
Conversely, But AMD is closing the gap with its new CDNA (Compute DNA) 4 architecture, which is around 35 times more powerful than its previous generation.
Additionally, It's at the foundation of new GPUs the MI355X, which just started shipping to customers.
At the same time, Oracle, for instance, has ordered over 130,000 of them (an important development), considering recent developments.
Nvidia and AMD will up the ante yet again in 2026 with a new series of GPUs, given current economic conditions. Nvidia plans to launch its Rubin chips, and AMD will release its MI400 Series.
Based on what we know so far, the two platforms are ly to der similar performance, so it could be the official moment AMD finally catches up to Nvidia from a nological perspective, in today's financial world.
Su will ly offer a gress on the MI400 on Aug.
But investors should also keep an eye out for on other duct platforms outside the data center, the Ryzen AI 300 series of chips for personal computers, in today's market environment.
They come with a built-in GPU, central cessing unit (CPU), and neural cessing unit (NPU) to form industry-leading AI chips, which are already being adopted by top PC manufacturers Asus, HP Inc.
, and Dell, in today's market environment.
PC chips are gradually becoming powerful enough to run AI workloads locally, which means queries don't have to travel back and forth to external data centers, in today's market environment.
Furthermore, This creates a faster user experience, and it also means AI applications can be run offline without an internet connection, making them more accessible.
Additionally, AMD's AI revenue ly soared again in Q2 AMD generated $7.
Furthermore, 4 billion in revenue during the first quarter of 2025 ( March 31), which was a 36% increase from the year-ago period (this bears monitoring), in this volatile climate.
Moreover, That included $3. 7 billion in data center revenue, which was up 57% on the back of strong GPU sales, and $2. 3 billion in client segment revenue, which was up 68% (something worth watching).
The client segment is where the company accounts for sales of its Ryzen AI chips. In contrast, AMD's guidance suggests its total revenue came in somewhere between $7.
1 billion and $7 (remarkable data) (an important development), amid market uncertainty.
Conversely, 7 billion during the second quarter, with the high end of that range representing 32% year-over-year growth.
What the re reveals is forecast includes an expected $700 million drop in revenue from the U.
Moreover, Government's restrictions on chip exports to China, so the company's results would otherwise be much stronger, given current economic conditions.
AMD didn't offer a specific second-quarter forecast for the data center or client segments, but considering they account for a combined 81% of the company's overall revenue, they are ly to continue driving most of its growth.
On the other hand, the company's smaller gaming and embedded segments could be a drag on the yet again.
AMD's gaming supplies chips for consoles Sony's Playstation 5 and Microsoft's Xbox, which are suffering a steady decline in sales.
Conversely, The embedded designs chips for industrial applications and its revenue has declined over the last few quarters, but AMD does expect a return to growth in the second half of this year.
Should you buy AMD stock before Aug. One quarter is unly to change AMD's positive long-term trajectory in the AI hardware space.
However, its stock isn't cheap right now ing a 30% year-to-date gain, so whether or not investors should buy it ahead of its upcoming earnings report might depend on their time horizon (which is quite significant).
On the other hand, Based on AMD's $3, in today's financial world. Nevertheless, 66 in adjusted (non-GAAP) earnings per (EPS), its stock trades at a price-to-earnings (P/E) ratio of 43.
On the other hand, Therefore, it's cheaper than Nvidia stock, which trades at a P/E ratio of around 53.
On the other hand, 7, but Nvidia's is growing at a much faster pace, which justifies its premium valuation.
That means investors who are looking for significant short-term gains from AMD stock over the next few months might be left disappointed.
In contrast, However, Wall Street's consensus estimate (vided by Yahoo. Finance) suggests AMD's non-GAAP EPS could grow to $5 (an important development).
However, 71 in 2026, placing its stock at a forward P/E ratio of just 27.
At the same time, That leaves room for considerable upside, so investors who are willing to hold the stock for the next 18 months could do very well if they buy it today, in light of current trends.
But holding AMD stock for an even longer-term period of five years or more will bably duce the best results, because it will give the company ample time to create value from its AI chip sales across the data center and PC, thus maximizing potential returns for investors.
In summary, short-term investors bably shouldn't buy AMD stock too aggressively ahead of Aug.
5, but those with a long-term outlook could earn great returns by scooping it up today (fascinating analysis) (which is quite significant).
Additionally, The Author Anthony Di Pizio is a contributing nology Analyst at The Motley Fool, covering publicly traded companies across artificial intelligence, cloud computing, autonomous vehicles, and enterprise software.
Prior to The Motley Fool, Anthony was a licensed fund manager, stock broker, and corporate advisor, in light of current trends.
Moreover, He holds a Bachelor of Commerce and Economics from Macquarie University in Sydney, Australia, and ASIC RG146 certifications in financial securities and derivatives.
Meanwhile, TMFAnthonyADSC X @AnthonyADSC Anthony Di Pizio has no position in any of the stocks mentioned.
Conversely, The Motley Fool has positions in and recommends Advanced Micro Devices, HP, Meta Platforms, Microsoft, Nvidia, and Oracle (something worth watching).
The data indicates that analysis reveals Motley Fool recommends the ing options: long January 2026 $395 calls on Microsoft and short January 2026 $405 calls on Microsoft, in this volatile climate.
The data indicates that Motley Fool has a disclosure policy, given the current landscape.