AMD Delivers Strong Q3 Earnings, Data Center Growth Drives Record Revenue
Advanced Micro Devices Inc. (AMD) concluded its third quarter on a high note, surpassing analyst expectations with a record revenue of $6.8 billion. This outperformance was fueled by a remarkable 122% year-over-year surge in Data Center revenue, reaching $3.5 billion.
The chipmaker’s earnings per share also met analyst predictions at 92 cents. While Gaming revenue took a hit, dropping 69% year-over-year to $462 million, AMD highlighted a notable 8% quarter-over-quarter increase in Embedded revenue, reaching $927 million, indicating a positive trend in specific end markets.
Growth Drivers and Optimistic Outlook
Lisa Su, AMD’s CEO and Chair, expressed satisfaction with the strong Q3 performance, attributing it to increased sales of EPYC and Instinct data center products and robust demand for Ryzen PC processors. She emphasized the company’s positive outlook, citing significant growth opportunities across Data Center, Client, and Embedded businesses driven by the insatiable demand for computing power.
Q4 Revenue Projections and Margin Expectations
Looking ahead, AMD projects fourth-quarter revenue to reach approximately $7.5 billion, with a potential variation of $300 million. This forecast represents a 22% year-over-year growth at the midpoint. The company anticipates an adjusted gross margin of roughly 54% in Q4, aligning with the Q3 adjusted gross margin.
Market Reaction
Despite the positive earnings report, AMD shares experienced a decline of 6.61% in after-hours trading, closing at $155.01 per share. This dip might be attributed to investor expectations and the overall market sentiment.
AMD’s Continued Focus on Growth
AMD’s Q3 results demonstrate the company’s commitment to expanding its presence in key technology sectors. With a strong focus on data center solutions and continued growth in client computing, AMD is poised to capitalize on the ever-increasing demand for computing power in a data-driven world.
