Is AMD Stock Safer Or Riskier Than A Year Ago? Trefis Team Fri, October 16, 2026 at 9:49 AM EDT 3 min read AMD -2.45% ^GSPC -0.03% INTC -2.36% NVDA +0.40% AVGO -1.70% Explore stocks on Coinbase Trading disclosure Trading disclosure The above button links to Coinbase. Yahoo Finance is not a broker-dealer or investment adviser and does not offer securities or cryptocurrencies for sale or facilitate trading. Coinbase pays us for certain activity generated through this link. Prices displayed are informational.
Investors holding Advanced Micro Devices (AMD) stock have enjoyed a very good year: shares returned 157.8% over the past year, compared with a 17.9% gain for the S&P 500. A return of that magnitude prompts a closer look at the underlying business, and the company's financial report for the quarter ended June 27, 2026, provides the latest view into its accounts. Has the company taken on more risk to get there?
Mostly Safer, But AMD Is Spending More On Assets
The balance sheet is mostly safer, because AMD holds far more cash than it did a year ago. At the end of the quarter on June 27, 2026, cash and short-term investments stood at $13.1 billion, up from $5.87 billion a year earlier. Total debt also rose during that period, climbing to $4.28 billion from $3.89 billion. Even so, AMD ended the quarter with net cash of $8.84 billion.
AMD has changed in one key area: capital spending is now running above its depreciation and amortization charge. Over the twelve months to June 27, 2026, capital spending reached $1.68 billion, compared with a $1.17 billion depreciation and amortization charge. That reverses a long trend. At each of the 16 quarter ends prior to that, from June 2022 to March 2026, twelve-month capital spending stayed below the charge for the same twelve months. In the latest quarter alone, AMD spent $808 million on new assets, up from $282 million in the same quarter a year earlier.
The company appears to be spending to keep pace with demand it did not anticipate. Server chip supply ran tight through the first half of the year because much of the demand was unforecasted, management noted on the August 4, 2026, call. AMD has also been working across its supply chain, from wafers to substrates, to raise capacity for servers.
That demand is visible in the latest financial results. Data center revenue grew 107% from a year earlier to $6.7 billion in fiscal Q2 2026, management said. Helios, the system housing AMD's MI450 series GPUs, was in production at the time of the call, with Microsoft and Anthropic both planning to deploy it. First shipments were scheduled to begin later that quarter, which is the period AMD reports next, on or around November 3, 2026.
What Does AMD's Spending Mean For Your Money?
Free cash flow, the cash remaining after capital spending, was $1.56 billion in fiscal Q2 2026. Over the twelve months to June 27, capital spending amounted to 16.6% of the cash AMD's operations brought in. This offers a positive signal for shareholders: AMD pays for its new assets out of a small portion of its cash and keeps the rest.
A year ago, investors could assume AMD's capital spending stayed below its depreciation and amortization charge. That is no longer the case. The company's next report could show capital spending still above that charge, meaning the build goes on, or it could drop back below it, meaning AMD has slowed its spending. For the risk to be worth taking, AMD must keep turning the demand described by management on its call into data center sales.
Does This Mean You Should Act On AMD?
Our purpose is to inform you with unique data so you make the right investment decisions. That said, betting on a single stock is always risky, no matter which direction you choose.
There is a smarter approach. Since its inception, the Trefis High Quality (HQ) Portfolio has returned 105%, beating the benchmark that combines the three major indices - the S&P 500, S&P Mid-cap, and Russell 2000. And it did so without taking the concentrated risk that comes with do-it-yourself stock picking. If that is how you want to invest, the HQ Portfolio is the place to start.
