On Tuesday, Advanced Micro Devices, Inc. (NASDAQ:AMD) said it has locked in enough memory supply to support its rapidly expanding AI ambitions, even as rising memory costs could pressure consumer demand across PCs and gaming later this year.
AMD Secures Memory Supply To Support AI Data Center Demand
During AMD’s first-quarter 2026 earnings call, CEO Lisa Su said the company’s partnerships with major memory suppliers have positioned it well despite an increasingly constrained market.
“We have secured enough supply to certainly meet and exceed our targets,” Su said, noting that while the memory market remains tight, AMD’s supplier relationships remain strong.
The comments address growing investor concerns over whether AMD can compete effectively for critical memory components — particularly high-bandwidth memory — as demand surges across the AI infrastructure market.
Rising Memory Prices Create Inflation Pressures
Su acknowledged that higher memory prices are creating cost pressures industrywide, with manufacturers and customers alike grappling with inflationary dynamics.
“In the time of tight supply, we are seeing some cost increases on the memory side,” she said.
However, AMD indicated enterprise and hyperscale customers focused on AI deployments are prioritizing supply availability over pricing concerns, suggesting data center growth remains resilient.
PC And Gaming Markets Could Face Demand Headwinds
While AMD’s AI and data center segments remain strong, Su warned that escalating memory prices could have broader consequences for mainstream consumer markets.
The company expects rising component costs may dampen second-half demand in both the PC and gaming sectors as higher system prices weigh on buyers.
AMD Q1 Earnings Beat And Strong Q2 Outlook
AMD reported first-quarter revenue of $10.25 billion, surpassing Wall Street expectations of $9.89 billion. Adjusted earnings came in at $1.37 per share, ahead of analyst projections of $1.29 per share.
Overall revenue climbed 38% from the same period last year.
Looking ahead, AMD forecasts second-quarter revenue of about $11.2 billion, with a possible variance of $300 million, topping analyst estimates of $10.52 billion.
The company also expects adjusted gross margin to improve to roughly 56% in the second quarter, up from 55% in the first quarter.
Price Action: AMD shares closed Tuesday at $355.26, up 4.02% and surged17.10% in pre-market trading on Wednesday to $416, according to Benzinga Pro.
According to Benzinga Edge Rankings, AMD ranks in the 96th percentile for Momentum, reflecting strong performance across short, medium and long-term trading timeframes.
Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.
Photo courtesy: jamesonwu1972 On Shutterstock.com
Recent Comments