Advanced Micro Devices shares climbed 7 percent in extended trading Tuesday after the company posted third-quarter results that comfortably beat Wall Street expectations. The chipmaker reported revenue of 13.38 billion dollars, a 45 percent increase from the previous year, driven largely by a massive surge in its data center business. This specific segment has become the engine of AMD’s growth, now accounting for 64 percent of total revenue compared to just 47 percent a year ago.
Chief Executive Officer Lisa Su expressed strong confidence in the company’s trajectory, noting that demand for data center processors is expected to accelerate further. While competitors like Intel have also seen growth in this sector, AMD appears to be navigating the supply chain more effectively, avoiding the guidance concerns that recently sent Intel’s stock tumbling. The resurgence is being fueled by the rise of agentic AI applications, which rely heavily on server CPUs to power virtual machines for extended periods.
The success in high-end AI infrastructure provides a critical cushion as other parts of the business struggle. AMD’s gaming and PC chip segments saw declines, with gaming revenue dropping 40 percent amid a broader industry slump and rising component costs that have dampened global PC shipments. Despite these headwinds, the company’s aggressive expansion into AI hardware, including its Helios rack-scale systems used by giants like Meta and Microsoft, has kept investors bullish.
Looking ahead, AMD expects fourth-quarter revenue to hit approximately 17 billion dollars, surpassing analyst estimates. To sustain this momentum, Su is focusing on scaling supply through 2027 and expanding the company’s intellectual footprint. Recent strategic moves include an 8.2 billion dollar acquisition of World Labs to develop 3D world models for robotics, alongside significant investments in AI pioneers like Anthropic.
