Advanced Micro Devices Inc. (NASDAQ:AMD) is gearing up to release its third-quarter earnings report on November 7, 2023, amid strong seasonal trends, a booming artificial intelligence (AI) narrative, and renewed optimism from Wall Street. This combination could potentially lead to significant gains for the chipmaker as it approaches a pivotal month.
Strong Earnings Expectations
Analysts have set high expectations for AMD’s upcoming earnings, with median estimates from Benzinga Pro anticipating earnings of $1.16 per share on revenue of $8.74 billion. If achieved, this would represent a remarkable 26% increase in earnings per share from $0.92 a year ago and a 28% rise in revenue compared to $6.72 billion. This expected growth reflects AMD’s expanding presence in the AI chip market, where its latest products are gaining traction with major enterprises.
AMD’s historical performance in November enhances the anticipation surrounding its earnings. Over the past decade, the company’s stock has averaged a return of 16.8% during this month, achieving positive gains in eight of the last ten years. A standout year was November 2021, when shares soared by 31.7%. Since 1995, the average gain for AMD in November has been 12.07%, with a success rate of 67%. Losses exceeding 5% have occurred only five times in the past three decades.
AI Innovation Fuels Investor Confidence
Investor optimism is further buoyed by AMD’s advancements in AI technology. Recently, Bank of America analyst Vivek Arya raised AMD’s 12-month price target to $300, indicating a potential 13% upside from current levels. Arya highlighted AMD’s improved visibility regarding the deployment of its MI450 rack ‘Helios,’ following insights gained at the 2025 Open Compute Project (OCP) conference in San Jose.
The Helios racks, which are designed around AMD’s Instinct MI450 GPUs, are expected to launch in the latter half of 2026. Notably, Oracle is planning a substantial rollout of a 50,000-GPU cluster, showcasing the confidence in AMD’s capabilities. These racks utilize open designs favored by major cloud providers, including Meta and OpenAI.
Arya projects that AMD could capture over 5% of the AI accelerator market by 2027, an increase from previous estimates of 3-4%. In a scenario where OpenAI achieves full deployment of 6 gigawatts over four years, Arya estimates that AMD could see earnings per share reach between $10 and $11, with the potential to exceed $15 by 2030. Under a complete OpenAI deployment, AMD’s market share could rise closer to 7.5%.
What Lies Ahead
Following the earnings report, investors will be keenly observing AMD’s Analyst Day on November 11, 2023. This event is expected to provide further insights into the company’s growth strategy, updates on product roadmaps, and guidance on its AI initiatives. Despite trailing behind Nvidia Corp. (NASDAQ:NVDA) in the AI graphics processing unit market, AMD has established itself as a credible alternative for hyperscalers seeking to diversify their supply chains.
With strong earnings forecasts, robust seasonal trends, and an increasing focus on AI technologies, AMD appears well-positioned for a successful November, pending the release of favorable financial results. As the landscape of technology and AI evolves, AMD’s performance will be crucial for investors and stakeholders alike.
