AMD Tops Revenue Estimates at $13.4 Billion as Data Center Sales Jump 97%

Advanced Micro Devices (Nasdaq: AMD) reported third-quarter revenue of $13.4 billion, above the $13.09 billion analysts expected, and adjusted earnings per share of $2.09 against the $1.94 consensus estimate, in an 8-K filed Tuesday.

Revenue rose 45% from a year earlier, when it was $9.2 billion. GAAP diluted earnings per share were $1.46, up 95% from $0.75.

Data Center drives growth

Data Center segment revenue was a record $8.5 billion, up 97% year over year, driven by demand for AMD EPYC processors and the launch of AMD Instinct MI450 Series GPUs. Segment operating income was $2.9 billion.

Client and Gaming revenue fell 8% to $3.7 billion. Gaming revenue dropped 40% to $773 million on lower semi-custom and graphics revenue, while Client revenue rose 7% to $2.9 billion. Embedded segment revenue was $1.1 billion, up 29%.

Margins and outlook

Non-GAAP gross margin was 56%, and non-GAAP operating income was $3.9 billion, up 75%. GAAP operating income was $2.8 billion.

For the fourth quarter, AMD expects revenue of approximately $17 billion, plus or minus 3%, against the $16.15 billion analysts expected for the period. The company expects non-GAAP gross margin of about 55%. The midpoint of the revenue range represents growth of about 66% from a year earlier.

Chair and CEO Lisa Su said the company expects growth to accelerate in the fourth quarter as it scales Helios and Venice production. CFO Jean Hu said the outlook reflects accelerating revenue and earnings growth driven by demand across the Data Center portfolio.

Total debt was $7.1 billion at quarter end, including a $4.75 billion senior notes offering completed in August. Cash, cash equivalents and short-term investments totaled $15.8 billion.