Last week, Advanced Micro Devices (NasdaqGS:AMD) introduced its Radeon RX 9000 Series, aiming to push the boundaries of gaming performance with features like AI-powered enhancements and next-gen display support. Despite these innovations, the company's stock saw a decline of 9.91% over the same period. One factor could be the broader downturn in the tech sector, as indicated by the Nasdaq's 3.5% loss for the week. The market was still reeling from a tech sell-off sparked by Nvidia's earnings report, which heightened concerns about AI sector investments. Additionally, ongoing trade uncertainties related to tariffs announced by President Trump have added to the cautious investor sentiment. While AMD's partnership with Kalyani Powertrain in India signifies strategic expansion, these broader market challenges have overshadowed its recent product announcements, aligning with the general tech market's retreat.

Take a closer look at Advanced Micro Devices's potential here.

The past five years have seen AMD's total shareholder return reach 105.52%, reflecting significant growth in both share price and dividends. This impressive performance contrasts with a backdrop of fluctuating earnings, where AMD experienced periods of high growth alongside some profitability challenges. Despite its earnings declining by an average of 6.2% annually over this period, AMD made impactful product launches like the RDNA 4 and notable partnerships, such as the collaboration with Ocient to enhance AI applications and initiatives with TSMC on 3D chiplet technology, which contributed to its strengthened market position.

Additionally, AMD's ongoing stock repurchase program, authorizing up to US$4 billion in share buybacks, has played a role in boosting shareholder returns. However, over the past year, the company's returns lagged behind both the U.S. market and semiconductor industry, which posted returns of 15.3% and 19.3% respectively, reflecting broader industry and market challenges. As AMD continues to innovate and expand, these developments are shaping its long-term performance landscape.

• Discover whether Advanced Micro Devices is fairly priced, undervalued, or overvalued in our comprehensive valuation breakdown.
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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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