Advanced Micro Devices reported stronger-than-expected fourth-quarter results on Feb. 2, 2026, and issued an upbeat sales outlook for Q1 2026, but investors sold the stock after hours. The chip designer said Q4 revenue was $10.27 billion, above the Street’s $9.65 billion estimate, and adjusted EPS was $1.53 versus a $1.32 consensus. For the current quarter AMD guided to $9.8 billion, plus or minus $300 million, and an adjusted gross margin of about 55%. Management noted $100 million of that Q1 revenue guidance comes from MI308 AI chips shipped to customers in China.
Key takeaways
- Q4 revenue: $10.27 billion, beating the FactSet estimate of $9.65 billion by $620 million.
- Q4 adjusted EPS: $1.53, outpacing the $1.32 analyst consensus.
- Q1 2026 revenue guidance: $9.8 billion ± $300 million; consensus was roughly $9.4 billion.
- Q1 adjusted gross margin guidance: about 55% (Street estimate ~54.5%).
- MI308 China sales: AMD recorded $390 million of MI308 shipments to China in Q4 and expects $100 million of MI308-related revenue in Q1 guidance.
- Market reaction: AMD shares fell nearly 7% in after-hours trading despite the beat and the constructive guidance.
- Company medium‑term target: CEO Lisa Su reiterated a goal of >35% compound annual revenue growth over the next three to five years, with data-center revenue rising above 60% annually.
Background
The latest results arrive as demand for artificial‑intelligence hardware remains the dominant theme across semiconductor markets. Nvidia set the pace for AI accelerators, but AMD has pushed to expand its presence in GPUs and data-center inference chips. At the same time, supply constraints and the cadence of new product ramps at rivals such as Intel have created windows of opportunity for market-share gains.
Export and trade considerations have added complexity to AI chip sales. U.S. export controls and customer approvals have limited how many advanced accelerators can flow to China; shipments that do occur therefore draw close regulatory and investor scrutiny. The MI308 shipments reported by AMD reflect both product availability and approved channels for certain AI processors.
Main event
AMD’s reported Q4 revenue of $10.27 billion exceeded its own guidance range ($9.3 billion to $9.9 billion) and FactSet consensus of $9.65 billion. Adjusted EPS of $1.53 also topped estimates. Management highlighted strength across core businesses, with particular emphasis on AI and data-center demand.
For Q1 2026 AMD guided revenue of $9.8 billion ± $300 million and an adjusted gross margin of roughly 55%. Company executives said that guidance includes about $100 million of MI308 sales to China, following $390 million in MI308 China revenue recorded in Q4. Excluding those China sales would have brought reported results closer to the consensus estimate.
Despite the numerical beat and a constructive outlook, investors reacted negatively in after‑hours trading, sending shares down nearly 7%. Traders cited factors including profit‑taking after a strong 2025 run, concerns about the sustainability of AI hardware demand, and scrutiny of the China revenue component of guidance.
Analysis & implications
Short term, AMD’s results demonstrate the company is converting AI demand into revenue, with MI308 shipments to China visible in the numbers. That revenue helped lift Q4 above consensus and is explicitly built into Q1 guidance. For investors focused on quarter-to-quarter beats, tangible China sales may be interpreted as both evidence of market traction and a source of uncertainty given geopolitical sensitivities.
Over the medium term, AMD’s stated target—more than 35% CAGR over three to five years, and data‑center growth north of 60%—depends on continued adoption of its MI3x family and EPYC CPU lineup. Execution risk includes customer design wins, wafer/supply constraints, competitive responses from Nvidia and Intel, and the timing of large hyperscaler purchases.
Market reaction shows a gap between operational performance and investor expectations. Beats that rely on one‑time or timing-sensitive revenue (for example, a cluster of approvals enabling China shipments in a quarter) can prompt skepticism, as traders try to separate recurring demand from transient flows. If MI308 shipments to China prove repeatable at scale, they could materially improve AMD’s data‑center revenue profile; if they are episodic, guidance may prove volatile.
Comparison & data
| Metric | Reported | Street Estimate / Prior Guidance |
|---|---|---|
| Q4 revenue | $10.27 billion | $9.65 billion (FactSet) |
| Q4 adjusted EPS | $1.53 | $1.32 (FactSet) |
| Q1 revenue guidance | $9.8B ± $0.3B | ~$9.4 billion (consensus) |
| Q1 gross margin guide | ~55% | ~54.5% (estimate) |
| MI308 China revenue | $390 million (Q4); $100 million included in Q1 guide | — |
The table highlights that the outperformance in Q4 mainly reflected higher-than-expected AI and data‑center sales, including committed MI308 shipments to China that materially contributed to the beat. Investors will watch whether MI308 volumes persist and how AMD manages margin mix as data-center revenue scales.
Reactions & quotes
“We are entering 2026 with strong momentum across our business.”
Dr. Lisa Su, AMD (press release)
AMD framed the quarter as a momentum beat, pointing to AI and data‑center traction. Management’s emphasis on momentum is intended to reassure investors that the beat reflects demand rather than timing alone.
“I don’t get where all this insanity is coming from.”
Sam Altman, OpenAI (social post)
While this quote refers to reporting on Nvidia and OpenAI rather than AMD directly, it illustrates the heightened scrutiny and heated market debate around AI supply chains and vendor relations that help shape investor sentiment across semiconductor names.
Unconfirmed
- Whether MI308 shipments to China will continue at similar or larger scales in subsequent quarters is not confirmed and depends on approvals and customer demand.
- The company’s >35% CAGR target is management guidance rather than an independent forecast and assumes sustained AI and data-center demand.
- Reports about the precise competitive impact of competing chips on AMD’s inference performance are incomplete and based on industry sources; broader benchmarking and customer feedback remain limited publicly.
Bottom line
AMD delivered a clear numerical beat in Q4 2025 and gave upbeat Q1 2026 guidance that incorporates modest MI308 sales to China. The figures show demand for AI accelerators is contributing meaningfully to near‑term revenue, but investors reacted negatively, signaling skepticism about sustainability and the role of timing in the beat.
For long‑term investors the key questions are execution and durability: can AMD convert product momentum into repeatable, large-scale data‑center contracts while managing margins and competition from Nvidia and Intel? The company’s aggressive multi‑year growth targets set a high bar that will be tested by product cycles, customer adoption, and geopolitical dynamics affecting chip flows.
Sources
- Sherwood News (media report)
- AMD Investor Relations (official company filings and press releases)