Proactive Investors - Shares in Advanced Micro Devices (NASDAQ:AMD) Inc (NASDAQ:AMD, ETR:AMD) are heading for a 6% fall on Wednesday after results for the past quarter were better than hoped but guidance for the start of 2024 was worse.
The semiconductor giant reported fourth-quarter results for 2023 after market close on Tuesday and, on an earnings call after, gave a bullish production for artificial intelligence (AI) chip sales this year, which appeared not to be bullish enough.
AMD bosses predicted upward of $3.5 billion of revenue in 2024 from data-center graphics processing units (GPUs), which focus on AI applications, an improvement from the prior guidance of at least $2 billion.
Some analysts said Wall Street was expecting more like $6 billion from these GPUs this year.
For the past quarter, the Santa Clara, California company reported $6.2 billion of revenue, beating estimates of $6.1 billion, while adjusted earnings per share of $0.77 per share were in line with the Street consensus forecast.
The reaction of the shares in afterhours trading likely reflected what analysts at Wedbush said was an earnings call where the focus was "solely on commentary regarding the success of AMD's AI efforts", with market expectations having ratcheted higher in recent months to drive the stock up over 50% since its AI focussed event in December.
AMD shares, which have more than doubled over the past 12 months to a recent all-time high just below $185, were changing hands at $161.28 in pre-market trading on Wednesday.