Advanced Micro Devices' (NASDAQ: AMD) share price plunged more than 10% following what can only be described as a great report. While the Q1 guidance may be tepid, analysts set the bar high, and growth is expected to continue under the influence of AI for many years. Datacenter growth is a factor in the plunge; it slowed from previously higher levels but remains solid and in hyper-growth mode, rising nearly 70% in the quarter, providing no reason to believe the company is in danger, far from it.
AMD’s position in the data center semiconductor market is well-established, and market share gains lie ahead. The slowing segment growth is due more to the law of large numbers than anything else; the $3.9 billion in revenue contribution is a company record expected to be exceeded in 2025. Additionally, the company is accelerating its AI stack development, making it easier to deploy and use, a factor that will impact results as the year progresses.
