After a shaky start to the year, AI stocks came roaring back in April, with the tech-heavy Nasdaq Composite Index ($NASX) jumping over 14% and the S&P 500 Index ($SPX) up 10%. AI optimism has returned in full force, with investors shifting their focus away from geopolitical tensions and toward strong earnings and massive AI-related spending. These two emerging AI players clearly stood out. In April alone, Advanced Micro Devices (AMD) stock climbed 68%, while Arista Networks’ (ANET) shares surged 40%.
With both AMD’s and Arista’s earnings coming up on May 5, are these two stocks a buy now?
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#1: Advanced Micro Devices: Riding the AI Accelerator Wave
Advanced Micro Devices designs high-performance computing chips, including CPUs, GPUs, and AI accelerators used in data centers, cloud infrastructure, PCs, and gaming systems. Right now, it is rapidly transforming into a full-scale AI infrastructure powerhouse. After what the company called a “defining year” in 2025, AMD is all set to report its Q1 of fiscal 2026 earnings on May 5 after the market closes. The stock’s rally in April implies investors are curious whether it will beat expectations as rival Intel (INTC) appears to be back in the game.
So far this year, AMD has handily outperformed both the Nasdaq and the broader market, gaining 64%.
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In fiscal 2025, AMD’s revenue surged 34% year-over-year (YoY) to $34.6 billion, with a 26% increase in earnings per share (EPS). Strong demand for EPYC server CPUs and the ramp-up of its Instinct AI GPUs drove a 39% surge in data center revenue. Its Instinct GPUs are now used by eight of the top 10 AI companies. Furthermore, AMD’s strategic, multi-year agreements with OpenAI, Meta (META), Hewlett Packard Enterprise (HPE), Lenovo, and Tata Consultancy Services highlight how deeply it is embedded in the AI value chain.
For the first quarter, AMD predicts a 32% increase in revenue to $9.8 billion, with analysts anticipating a 25% gain in EPS. Looking ahead, AMD’s roadmap remains…
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