Why AMD Stock Popped After Intel's Earnings Beat
Shares of rising Intel (NASDAQ: INTC) rival and fellow semiconductors giant Advanced Micro Devices (NASDAQ: AMD) popped in early trading on the Nasdaq Friday, the first day after Intel's disappointing Q1 2021 earnings report. AMD's shares were up 4.14% as of 11:10 a.m. EDT.
Intel, if you haven't heard, actually beat on its Q1 earnings. Despite sales declining 1% year over year, the company managed to report a pro forma profit of $1.39 per share, which was ahead of analyst expectations.
Regardless, Intel reported a steep 540 basis point decline in its gross margin to 55.2%, and it saw its operating margin cut nearly in half as the company spent heavily to race to catch up to its rivals in advanced computer chips. Analysts at Citigroup commented yesterday that Intel stock appears to be close to its peak valuation and is likely to decline as investors acclimate to the new environment in which Intel is losing, not gaining, market share.
Source Fool.com
