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Leading chip firm Advanced Micro Devices (AMD) reported blowout second-quarter earnings, firing on all engines and surpassing Street’s expectations. However, the market’s reaction was harsh. The stock dropped 7% intraday on Aug. 5 after the results, shedding the 7% it had gained on Aug. 4 in anticipation. The reason for this drop is heightened expectations from investors, as they anticipated more from AMD.
On paper, AMD has been a big winner regarding its Q2 earnings. The company’s shares have been running high due to the growing popularity of its artificial intelligence (AI) chips, as well as a resurgence in demand for its CPUs. Notably, the company has also raised expectations for the semiconductor market, projecting it to reach $2 trillion per year by 2028.
