Title: AMD and Palantir: AI Hype or Real Growth? Follow the Money
Stock futures are up, the market's feeling bullish, and everyone's slapping an "AI" sticker on their earnings reports. Palantir and AMD, two darlings of the 2025 market, are about to tell us if the AI rally has legs, or if it's just another tech bubble inflated by cheap money and wishful thinking. Let's dig into what to expect, because the devil, as always, is in the details.
Decoding the Earnings Season
The market's riding high on Big Tech earnings and cooling trade tensions. Fine. But let's not pretend the ongoing government shutdown isn't a giant asterisk next to every rosy prediction. With economic data releases on hold, Wednesday's ADP private payroll data is going to be dissected like a frog in high school biology class. Everyone's desperate for a signal, any signal, that the economy isn't about to faceplant.
And then there's earnings. Palantir (PLTR) and AMD are the headliners this week, and their numbers will be crucial. Hargreaves Lansdown analyst Matt Britzman says Wall Street is ready to "reward the positive narratives." I'm betting the market's going to demand more than just narratives. We need to see actual, verifiable growth that justifies the current valuations.
Palantir, fresh off its first billion-dollar revenue quarter, is expected to show earnings growth exceeding 60% year-over-year. Citigroup analyst Tyler Radke is bullish, citing "positive checks across Government and Commercial businesses." He's also pointing to new partnerships with Oracle and Snowflake. Radke has a buy rating on the stock. Palantir shares have risen after three of the last four earnings releases. The stock is up 168% YTD.
AMD is expected to report a year-over-year earnings gain of more than 25%. UBS analyst Timothy Arcuri anticipates strength in both server and client CPU, potentially boosting gross margins. He estimates data center GPU revenue around $1.7 billion and believes AMD could guide as high as $9.5 billion for the next quarter. Arcuri also has a buy rating. Historically, AMD averages a 1.6% drop on earnings days. But the stock is up 89% YTD. These companies are set to report in another busy week, according to Earnings playbook: AMD and Palantir set to report in another busy week.
The AI Litmus Test
These earnings reports aren't just about Palantir and AMD. They're a bellwether for the entire AI sector. Are companies actually spending money on AI infrastructure and software, or are they just talking about it to juice their stock price? Meta Platforms plunged last week after unveiling third-quarter earnings, which included guidance for even more capital spending on artificial intelligence. That's a red flag. Are they seeing real returns on those investments, or are they just throwing money into a black hole?
AMD's data center GPU revenue is the number I'll be watching most closely. If that number disappoints, it suggests that the AI boom is more hype than substance. And if Palantir's government contracts are driving the bulk of its growth, that raises questions about the sustainability of its business model. Government contracts are notoriously fickle.
I've looked at hundreds of these filings, and the degree to which firms are linking their earnings to AI is quite telling. Are they truly driving revenue with AI, or are they just riding the wave of hype?
So, What's the Real Story?
Look, I'm not saying Palantir and AMD are bad companies. But the market's current euphoria around AI is unsustainable. We need to see concrete evidence that these companies are generating real profits from their AI investments, not just promises and projections. Otherwise, this rally is going to end in tears.
