AMD posts record third quarter on AI chip demand, forecasts $17 billion for Q4

Record quarter on AI chip demand

Advanced Micro Devices reported third-quarter results on Tuesday, 3 November, with revenue up 45% to $13.38 billion. Adjusted earnings reached $2.09 per share, above market expectations. Chief executive Lisa Su said the quarter "was the largest and most profitable in our history" and that revenue exceeded the company's own forecast. The results followed fast-growing demand for AI processors.

Total revenue13.38

Data center revenue8.55

Gaming revenue0.773

Total revenue

13.38 US$ billion

Data center revenue

8.55 US$ billion

Gaming revenue

0.773 US$ billion

Data from the article text

Data center business carries growth

Data center revenue reached $8.55 billion, nearly doubling over the period, and made up roughly 63% of net quarterly revenue. Over the past couple of years, changes in total revenue have tracked the data center business closely. In the third quarter, total revenue rose $1.9 billion while data center revenue rose $1.8 billion.

In response to a question during Tuesday's earnings call, CFO Jean Hu said:

“Looking ahead of 2027, we actually think our data center business will be more than 80 percent of total company revenue.”

Guidance and consumer markets

AMD expects fourth-quarter revenue of about $17 billion, plus or minus 3%. Su said the company expects revenue to grow more than 80% in 2027, with the data center business as the largest contributor.

Gaming revenue fell 40% from a year earlier to $773 million. PCs, game consoles and other devices have seen price increases in recent months because of shortages of RAM and other components, which demand from AI data centers has driven. Intel said it does not expect the shortage to improve next year, while SK Hynix predicted it would last until 2030.

Su acknowledged the higher prices and said the company has seen some slowing in consumer sell-through. She added:

“We are planning with the current environment for a down year for 2027.”

Market reaction

AMD shares rose 7.5% in after-hours trading on Wall Street. Shares of rivals Intel and Nvidia each gained about 2% in its wake. Bob O'Donnell of the research firm TECHnalysis said the figures reinforced optimists' expectations of a continued AI boom. Super Micro Computer also forecast revenue of $19.5 billion to $21.5 billion for the quarter ending in December, above analysts' estimates, on continued demand for servers packed with AI chips.