AMD stock jumps 8% on earnings as data center revenue nearly doubles — SkimNews
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- AMD beat third-quarter estimates with adjusted EPS of $2.09 versus $1.95 expected and revenue of $13.38 billion versus $13.09 billion expected, up 45% from $9.25 billion a year earlier, sending shares up 8% in extended trading.
- AMD's data center unit revenue nearly doubled year over year and now accounts for 64% of total revenue, up from 47% a year earlier, with the company expecting data center to drive the majority of revenue and earnings growth.
- Lisa Su told analysts AMD expects server revenue to double year over year in 2027 and data center AI growth to run ahead of its projection from 90 days ago, after working with suppliers to secure wafers, substrates, advanced packaging and memory for higher growth next year.
- Intel posted similar data center growth of 78% in the third quarter yet its stock plummeted 29% on Friday over weak guidance, the sharpest contrast to AMD's after-hours gain.
- PC and gaming revenue at AMD fell 8% year over year to $3.7 billion, with gaming revenue down 40%, while global PC shipments declined 4% in the second quarter on soaring memory and component costs.
- Fourth-quarter guidance calls for about $17 billion in revenue, above the $16.2 billion analyst average, but gross margin of 55% versus the 55.3% consensus estimate.
- Helios, AMD's rack-scale system competing with Nvidia's Grace Blackwell and Vera Rubin, is being deployed by Meta, Microsoft, Anthropic, OpenAI and Oracle; AMD separately agreed to invest $1 billion in Meta's equity offering and has committed up to $5 billion in Anthropic.
Why it matters: Intel grew data center revenue 78% and still lost 29% on weak guidance, while AMD's nearly doubled data center sales sent shares up 8% after hours — guidance, not growth alone, separated the two stocks. AMD's 55% fourth-quarter gross margin guide, below the 55.3% consensus, stands out now that data center reaches 64% of revenue, up from 47%.
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