AMD Reports Record Q2 Revenue Despite Inventory Write-Down and China Export Constraints

Advanced Micro Devices Inc. (AMD) posted a record $7.7 billion in Q2 revenue, marking a 32% year-over-year increase. The surge was fueled by strong performance in Client and Gaming segments, with Ryzen Zen 5 CPUs driving a 69% revenue jump. However, earnings per share fell short of expectations at $0.48, impacted by an $800 million inventory write-down tied to halted MI308 GPU shipments to China due to export controls.

Gross margin settled at 43% for the quarter, a significant drop from the 54% it WOULD have achieved without the inventory charge. Data Center margins were particularly hard hit by the China restrictions. Despite these challenges, net income improved to $872 million, up from $265 million a year ago.

The semiconductor stock closed at $174.31 on August 5, down 1.40%, before plunging another 6.56% in pre-market trading to $162.88 following the earnings release. Market reaction reflects concerns over margin pressures and geopolitical risks overshadowing record top-line growth.