AMD's stock rose 8% in extended trading after the chipmaker reported third-quarter earnings that beat Wall Street expectations. Revenue jumped 45% to exceed the $9.25 billion reported a year earlier, while data center sales nearly doubled.
Data center now accounts for 64% of AMD's overall revenue, up from 47% a year ago. CEO Lisa Su said on the earnings call that the company expects server revenue to double year over year in 2027 and data center AI growth to accelerate faster than previously projected.
Su noted that AMD has secured components across its supply chain. "We have worked across our supply chain to secure the wafers, substrates, advanced packaging, memory, and other key components needed to support much higher growth next year," she said.
AMD's server CPUs are gaining traction in agentic AI applications, which power virtual machines that can run for hours independently. "Adoption is just starting, and we expect demand to grow sharply as agents are deployed more broadly and take on more complex work," Su told analysts.
The company's PC and gaming segment showed weakness. Revenue in that business, which combines PC and gaming chips, fell 8% to $3.7 billion. Gaming revenue dropped 40%.
For the fourth quarter, AMD guided to $17 billion in revenue, above the $16.2 billion average analyst estimate. The company expects a 55% gross margin for the quarter.
AMD also competes with Nvidia in data center GPUs and rack systems called Helios. Meta, Microsoft, Anthropic, OpenAI, and Oracle have begun deploying AMD Helios systems. AMD has agreed to invest $1 billion in Meta's equity offering and committed to investing up to $5 billion in Anthropic.