Advanced Micro Devices reported third-quarter revenue of $13.4 billion, a 97% increase from a year earlier, driven by a massive surge in data center sales. The company's data center segment produced $8.5 billion, accounting for approximately 63% of total net revenue. This growth was fueled by Instinct accelerators and Epyc server processors, as the company transitions into an AI infrastructure provider.
CEO Lisa Su described the quarter as "the largest and most profitable in our history." Su stated that the company expects data center revenue to become the primary driver of the business, with CFO Jean Hu forecasting that the segment will represent more than 80% of total company revenue by 2027. Su also noted that the company expects revenue to grow by more than 80% in 2027.
While AI demand bolstered the server business, the company's consumer segments faced significant headwinds. Gaming revenue plummeted 40% to $773 million, impacted by rising component and memory costs that have increased the pricing of consoles and handheld PCs. The combined Client and Gaming segment brought in $3.7 billion, an 8% decrease from the previous year.
AMD's stock jumped as much as 8% in extended trading following the report, which beat Wall Street expectations for both earnings per share at $2.09 and total revenue. The company's Helios rack-scale systems are seeing adoption from major tech firms including Meta, Microsoft, Anthropic, OpenAI, and Oracle.
Looking ahead, AMD issued a cautious outlook for the consumer market, predicting the PC market will decline by a double-digit percentage in 2027. The company expects fourth-quarter revenue to reach approximately $17 billion, surpassing analyst estimates. To support its growth, AMD has committed significant capital to AI developers, including a $5 billion investment in Anthropic and a $1 billion investment in Meta's equity offering.
