Advanced Micro Devices Inc. (NASDAQ:AMD) is preparing to report first-quarter earnings on Tuesday. Investors are weighing whether its AI-fueled stock rally reflects genuine long-term growth or expectations that may have outpaced near-term financial reality.
AMD Earnings Preview: AI Ambitions Fuel Investor Optimism
On Monday, Futurum Group Chief Market Strategist Shay Boloor described AMD as one of the market's most compelling rerating stories.
He noted that the company is shifting from a CPU-focused growth narrative toward becoming a broader AI infrastructure contender.
"I think Q1 should be strong," Boloor said on X, while cautioning that AMD's last month's rally suggests investors may already be pricing in future AI success before substantial revenue fully arrives.
AMD shares have surged 55.12% over the past month, according to Benzinga Pro.
Shay Boloor Flags Valuation Risks Despite Long-Term AI Promise
Boloor highlighted that AMD's bigger test may come later in 2026, when products like MI400 and Helios, along with expected deployments from Oracle Corp (NYSE:ORCL), Meta Platforms, Inc. (NASDAQ:META) and OpenAI, could serve as stronger proof of its AI competitiveness.
While Baloor believes AMD is building credibility as an alternative to Nvidia Corp (NASDAQ:NVDA) for hyperscalers seeking lower costs and diversified supply, he warned that even strong earnings could trigger a sell-off if expectations are too elevated.
Jim Cramer Defends AMD Stock As AI And CPU Demand Accelerate
On the same day, during the CNBC Investing Club's Morning Meeting, Jim Cramer pushed back against skepticism, arguing AMD remains well-positioned due to surging demand for CPUs and GPUs as agentic AI systems expand.
"Advanced Micro has CPUs, and CPUs are what is being used by agents," Cramer said. "So if you have them, this stock is going to go up much more."
AMD shares fell more than 5.27% on Monday following an HSBC downgrade, but gained 0.47% in the after-hours trading, reaching $343.15.
AMD Q1 Revenue Growth And AI Rally Raise Earnings Stakes
Wall Street expects AMD to post first-quarter revenue of $9.88 billion, up sharply from $7.44 billion a year earlier.
The chipmaker has surpassed revenue estimates for 14 consecutive quarters.
AMD shares soared 74% in April — their strongest monthly performance since January 2001.
In the previous quarter, AMD reported a 34% year-over-year revenue increase, driven by 39% growth in its Data Center business and a 37% rise in its Client and Gaming segment.
According to Benzinga Edge Rankings, AMD ranks in the 97th percentile for Momentum, reflecting strong performance across short, medium and long-term trading trends.
Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.
Photo courtesy: Piotr Swat via Shutterstock
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