AMD Beats Estimates, Jumps 8% on Data Center Growth — SkimNews
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- AMD posted third-quarter adjusted EPS of $2.09 versus LSEG's $1.95 estimate and revenue of $13.38 billion versus $13.09 billion, up 45% from $9.25 billion a year earlier; shares rose 8% in extended trading.
- AMD's data-center sales nearly doubled year over year, and the unit rose to 64% of company revenue from 47%; AMD expects it to drive most revenue and earnings growth.
- Lisa Su said AMD expects server revenue to double year over year in 2027 and data-center AI growth to outpace its projection from 90 days earlier, after securing wafers, substrates, advanced packaging and memory for higher growth next year.
- AMD guided to about $17 billion in fourth-quarter revenue, above LSEG's $16.2 billion average, but projected a 55% gross margin versus StreetAccount's 55.3% estimate.
- Helios racks are being adopted by Meta, Microsoft, Anthropic, OpenAI and Oracle, with Meta's systems already running; AMD also agreed to invest $1 billion in Meta's equity offering.
- AMD's combined PC and gaming business fell 8% year over year to $3.7 billion, gaming revenue dropped 40%, and global PC shipments declined 4% in the second quarter.
- Intel disclosed similar data-center growth, with segment revenue up 78% in the third quarter, but its stock fell 29% on Friday over weak guidance and concerns about meeting demand.
Why it matters: AMD's revenue base is now dominated by data centers, which expanded from 47% to 64% of sales. Helios adoption by Meta, Microsoft, Anthropic, OpenAI and Oracle gives its Nvidia rivalry concrete deployments, while the 8% after-hours move showed investors rewarded that mix shift.
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