AMD Stock Forms Bullish Flag Ahead of Nvidia Earnings

AMD stock has retreated from its 2026 peak as investors reassess valuations across the semiconductor sector. Shares recently traded near $469, down from a year-to-date high around $584.

The pullback comes despite strong second-quarter results from Advanced Micro Devices. Attention now turns to Nvidia’s Aug. 26 earnings, which could influence sentiment toward AMD and other AI-linked chipmakers

AMD Stock to React to Nvidia Earnings

Advanced Micro Devices stock has pulled back sharply in the past few weeks as investors reacted to the ongoing volatility in the equities market. A closer look shows that many semiconductor companies have all pulled back in this period.

The next important catalyst to watch will be the upcoming Nvidia earnings that come out next week. These results are important for AMD for two main reasons. First, they will provide more hints on whether the semiconductor industry is doing well.

Analysts expect the upcoming results to show that its revenue jumped by 96% in the second quarter to over $92 billion. Strong earnings will be a good sign for AMD, a company that has gained market share in the industry.

At the same time, the results will provide more color on its Vera CPUs, which aim to challenge AMD and Intel’s dominance. This business may ultimately have an impact on AMD’s business in the long term.

AMD’s Business is Thriving

Nvidia’s results will come a few weeks after AMD published strong financial results that demonstrated that its business was firing on all cylinders. This growth was mostly because of its data center business, which has continued to gain market share this year.

These results revealed that AMD’s revenue jumped by 50% in the second quarter to over $11.56 billion. It had made $10.2 billion in the previous quarter. Also, its gross margin jumped to 54% from the previous 40%.

Most of AMD’s revenue came from the data center business, which made over $6.7 billion in revenue, while its client and gaming made $3.8 billion. The smaller embedded revenue jumped by 19% to $977 million.

Analysts following the company expect its business to continue growing this year. The estimate is that its third-quarter revenue will be $13 billion, up by 40% YoY. In total, the annual revenue is expected to surge by 46% this year to $50.8 billion, followed by $87 billion next year.

AMD has a long track record of doing better than estimates, and the recent earnings by its top clients like Microsoft, Meta Platforms, and Apple showed that they were not slowing down their spending.

The challenge, however, is that AMD trades at a significant premium compared to Nvidia, which is growing at a faster pace. AMD has a forward price-to-earnings ratio of 62, much higher than Nvidia’s 64. Its forward EV-to-EBITDA multiple has moved to 56, also higher than Nvidia’s 22. As a result, the company will likely need to execute properly to justify its valuation.

AMD Stock Must Hold Support Before Targeting $550

The $550 target remains conditional rather than the most likely guaranteed outcome. AMD first needs to stabilize above the current support region and break descending resistance.

A move above $500 would provide stronger evidence that buyers have regained momentum. A sustained breakout could then open a path toward $550 and eventually the previous high.

The downside scenario remains important after the recent pullback. A break below the 100-day EMA would weaken the bullish-flag thesis and suggest the correction is extending.

For now, AMD stock sits between strong fundamental growth and elevated market expectations. Nvidia’s Aug. 26 earnings could provide the next sector-wide catalyst, but AMD still needs a confirmed technical breakout before the $550 target becomes stronger.

Disclaimer: This article is for informational purposes only and does not constitute financial advice. Equity markets can experience sharp price movements.