Data center revenue surged 57%. Morgan Stanley lifted its target to $360. And the Hormuz escort is already on pause.
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AMD reported after the close Tuesday and left nothing on the table. Revenue hit $10.25 billion, up 38% year over year, beating the $9.9 billion consensus by more than $300 million. The stock surged roughly 18% in premarket trading.
What matters:
AMD's data center segment grew 57% to $5.8 billion, with operating profit up 72%. Q2 guidance of $11.2 billion came in well above consensus.
The Hormuz escort is on pause. The administration suspended Project Freedom less than 48 hours after launch, citing progress toward a deal with Iran. The naval blockade remains.
Brent crude is trading around $114 this morning. WTI is near $103. Both have pulled back from Monday's spike.
Futures are pointing sharply higher, led by the Nasdaq. The S&P 500 closed Tuesday at 7,259.22, a record. The Nasdaq finished at 25,326.13, also a record.
The data center number is the one that carries.
Non-GAAP EPS of $1.37 beat the $1.28 estimate by 7%. But the data center revenue of $5.8 billion, up 57% year over year, is where the thesis lives. EPYC server processors keep taking share, and the Instinct MI350 GPU line posted another quarter of record shipments.
Management guided Q2 revenue to $11.2 billion at the midpoint, implying 46% year over year growth and a sequential acceleration. Morgan Stanley responded by lifting its price target to $360 from $255.
After Palantir's 85% revenue growth earlier this week and now AMD's data center surge, two consecutive earnings cycles have confirmed the AI hardware and software layers are both converting capex into real revenue. That was the open question coming into this week.
Super Micro delivered a split verdict.
SMCI reported fiscal Q3 revenue of $10.2 billion, up 123% year over year but below the $12.36 billion estimate. EPS of $0.84 beat the $0.62 consensus. The miss came from component shortages and customer delays, not demand weakness.
The margin improvement is the signal worth tracking. Non-GAAP gross margin rose to 10.1% from 6.4% last quarter, a 58% sequential improvement. Management guided Q4 revenue to $11 billion to $12.5 billion and lifted full-year guidance to $38.9 billion to $40.4 billion.
The Hormuz pause complicates the energy call.
The escort operation launched Sunday with destroyers, more than 100 aircraft, and 15,000 service members. By Tuesday evening it was on hold, with the administration citing progress on a Pakistan-mediated agreement. The naval blockade of Iranian ports stays in place.
If a deal materializes, Brent could give back the premium that has kept it above $100 since the Strait effectively closed. If talks collapse and the escort resumes, the $126 spike from last week becomes the floor. Oil is digesting both scenarios, and the positioning call hinges on which one you assign higher odds.
Uber reports before the bell this morning.
Consensus expects EPS of $0.71 on revenue of roughly $13.3 billion. The print is a real-time read on discretionary consumer spending under $100-plus oil and 4.5% PCE inflation. Airbnb follows tomorrow, and the April jobs report Friday (consensus near 165,000) rounds out the week's macro slate.
Where things stand.
Gold is trading around $4,550. Bitcoin is near $79,900. The 10-year Treasury yield is around 4.42%.
Markets are at records, and the biggest AI hardware name just delivered a beat that justified the spending thesis. The Hormuz escort is on pause for the first time since it launched. If Uber confirms consumer resilience this morning and Friday's jobs number holds, the bears are running out of catalysts to lean on.
That's the read.