AMD’s Pre-Earnings Jitters: OpenAI Headwinds and Insider Sales Cloud a Stellar Run

AMD shares slide 6% on OpenAI growth fears ahead of May 5 earnings, with analysts split on AI demand and supply constraints.

Advanced Micro Devices heads into its quarterly report on May 5 with the stock nursing a sharp pullback, caught between a blistering rally and fresh doubts about the AI narrative that fueled it. The shares slid nearly 6 percent on Tuesday to €271.70, retreating roughly 8 percent from a 52-week high of €295 set just days earlier on April 24.

The immediate trigger was a Wall Street Journal report suggesting OpenAI had missed internal targets for user growth and revenue in 2025 — a claim the company dismissed as “ridiculous.” But the market’s reaction underscores a deeper anxiety. OpenAI struck a six-gigawatt data center deal with AMD last year, and holds warrants to acquire up to 10 percent of the chipmaker’s equity. Any slowdown in OpenAI’s trajectory could translate into weaker demand for AMD’s AI processors, particularly as the startup’s own CFO has warned of potential funding shortfalls for compute capacity if revenue doesn’t accelerate.

The selloff marks an abrupt gear change for a stock that had been on a tear. AMD has still gained roughly 42 percent year-to-date, and the broader semiconductor sector had strung together 17 winning sessions out of 18 before the reversal. Valuation concerns were already circulating before Tuesday’s news broke.

Analysts Split on the Path Ahead

Despite the pullback, several analysts remain bullish — though with caveats. DA Davidson’s Gil Luria upgraded AMD to “Buy” and raised his price target to $375 from $220, a 70 percent jump. Luria argues the market underestimates the shift toward “agentic” AI workloads, which increasingly rely on CPUs rather than GPUs, playing to AMD’s architectural strengths. He also boosted his revenue estimate for the current year by $2 billion.

Bank of America’s Vivek Arya lifted his target to $310, calculating that each installed gigawatt of AI capacity could generate between $15 billion and $20 billion in net revenue for AMD. Stifel, however, struck a more cautious tone, warning that supply constraints could cap growth even if demand remains robust.

The production bottleneck is a structural risk. Stifel’s analysts note that AMD’s expansion may be limited by how quickly it can manufacture chips through its foundry partners. U.S. export controls on China added another $440 million in net costs last fiscal year.

Insider Selling Adds to Caution

The recent rally has also attracted profit-taking from notable quarters. Cathie Wood’s ARK Investment Management sold 215,643 AMD shares worth approximately $75 million in late April. Insider sales have been a recurring theme in recent months, with executives also trimming positions.

The stock’s 60 percent surge over the past several weeks was partly ignited by Intel’s strong quarterly results, which beat its own revenue guidance by $1.4 billion — driven by unexpected demand for server processors. That momentum now faces a reality check.

What Investors Will Watch on May 5

AMD reports first-quarter earnings after the U.S. market close on Tuesday. The consensus estimate calls for revenue of roughly $9.84 billion, representing year-over-year growth of about 32 percent. The data center segment now accounts for more than half of total revenue, and investors will scrutinize whether partnerships with Meta and OpenAI are translating into tangible sales acceleration.

This week’s earnings from Microsoft, Amazon, Meta, and Alphabet will provide additional context. Their commentary on AI spending plans will either validate or undermine the OpenAI-driven selloff. For AMD, the key question is whether the production pipeline can keep pace with demand — and whether the AI narrative has enough fuel left to sustain a stock that had already priced in a lot of optimism.