AMD shares rise as data center revenue nearly doubles in third quarter
AMD reported third-quarter earnings that topped Wall Street estimates, fueled by significant growth in data center chip sales despite a cooling PC market.
Advanced Micro Devices reported third-quarter revenue of $13.38 billion, a 45% increase from the previous year, surpassing analyst expectations of $13.09 billion. Adjusted earnings per share reached $2.09, exceeding the projected $1.95. Following the report, company shares increased by 7% in extended trading.
The company’s data center unit remains the primary growth driver, now accounting for 64% of total revenue. CEO Lisa Su stated that the company is prepared to meet the accelerating demand for artificial intelligence hardware, maintaining a positive outlook for future growth in server processors.
Conversely, the company’s PC and gaming segment experienced a downturn, with revenue falling 8% to $3.7 billion. Gaming hardware sales saw a significant decline of 40% year-over-year, reflecting broader weaknesses in the global PC market that have affected major industry competitors.
Looking forward, AMD has issued revenue guidance of approximately $17 billion for the fourth quarter, signaling higher targets than the $16.2 billion average analyst estimate.