Lisa Su brushes off Musk's Nvidia commitment as AMD stock sinks after earnings

Advanced Micro Devices CEO Lisa Su on Wednesday brushed off comments from Elon Musk that SpaceX was committing to exclusively use Nvidia artificial intelligence chips.

"I have tremendous respect for Elon and everything that he has done, and so we look forward to continuing to partner over the longer term," Su told CNBC's "Squawk on the Street."

Musk said Tuesday on the company's earnings call that AMD's AI chip rival had "the best architecture" and touted the close cooperation and partnership with Nvidia. In May 2025, Musk told CNBC's David Faber that his AI company would buy chips from both companies, and possibly others.

Nvidia shares climbed about 3% on Wednesday.

Su called SpaceX "an incredibly important technology company" and said she's proud of the work AMD has done with them in several areas. She noted the company still has business with many tech companies, including those in the space market.

AMD's stock sank 7% on Wednesday despite posting strong second-quarter earnings and guiding for Data Center segment growth "well over 100%."

Su reinforced that outlook to CNBC on Wednesday, and explained how the company is planning into 2027 and beyond.

"We have much, much stronger customer visibility in this time frame," Su said. "And what customers are telling us is, you know, they want a lot more compute."

AMD revenue climbed 50% to $11.54 billion in the second quarter, ahead of analyst expectations of $11.28 billion, in a sign of the company's central position in the market for AI chips.

Data center sales drove much of the company's growth, up 107% on an annual basis to $6.7 billion, which the company attributed to central processing unit and graphics processing unit sales.

Su told analysts on the earnings call Tuesday that the company expects server revenue to grow 80% year-over-year in the second half of 2026 and more than 70% for 2027.

Su told CNBC on Wednesday that its customers are giving the company "much more opportunity to plan" with server supply.

"As a result, we're making investments across the supply chain," she said. "We're working with our partners. We're making backend investments. We're making the investments in the entire ecosystem, such that we'll be able to supply at the much higher rate that our customers are asking for."

But while second-quarter earnings came in "slightly ahead" of consensus, they fell below "more optimistic estimates," Deutsche Bank analysts said in a Wednesday note.

AMD shares year-to-date.

AMD has been a big beneficiary of the AI boom, with the stock trading up 132% so far this year. Confidence has been buoyed by the company's GPU and CPU products.

"AI is driving a significant expansion in demand for compute across all of our markets," Su said in a Tuesday statement. "Our leadership portfolio and growing customer visibility position us exceptionally well to capture this expanding opportunity and deliver substantial revenue and earnings growth in the years ahead."

Earnings failed to impress investors who've consistently been skittish this year of some AI stocks.

In July, AMD raised its expectations for the size of the semiconductor industry, saying it could be worth $2 trillion per year by 2028. The chipmaker sees $1.4 trillion of that coming from AI accelerators, or GPUs, up from a previous estimate of $500 billion by 2028.

"It's simply a case of market expectations being too high," Michael Field, chief equity strategist at Morningstar, told CNBC.

"The stock has trebled in the last 12 months and now trades on a P/E multiple of 170, meaning expectations are commensurately high," he added. "We view the dip as a potential buying opportunity, and investors may take a similar view in the coming weeks."

— CNBC's Kif Leswing helped contribute to this report.