AMD doubles data center revenue

AMD data center revenues nearly doubled year-over-year in the third quarter of 2026. The company also announced its financial results. Shares then rose 8 percent in after-market trading.

CEO Lisa Su described this period as the highest-income and most profitable quarter in the company's history. He also said that demand for AI servers is growing faster than previous predictions.

AMD data center revenues hit record

The company's revenue was $9.25 billion in the same period last year. However, this year it increased to $13.38 billion. Moreover, adjusted earnings per share was $2.09. However, analysts were expecting $1.95.

The decisive role in growth belongs to the data center business line. First of all, this segment brought in $8.5 billion in revenue. Thus, AMD data center revenues reached approximately 64 percent of total revenue. However, a year ago this rate was at 47 percent.

Of the $1.9 billion increase in total revenue, $1.8 billion came from data centers. Additionally, Lisa Su announced that they expect server revenues to double on an annual basis in 2027. In addition, he stated that they are making preparations in the supply chain for next year's growth.

It is stated that the company is trying to secure capacity in critical components such as wafers, substrates, advanced packaging and memory. On the other hand, CFO Jean Hu said that the data center could account for more than 80 percent of total revenue after 2027. Additionally, AMD expects its revenue to increase by more than 80 percent in 2027.

Artificial intelligence agents increase processor demand

AMD has long been competing against Nvidia's dominance in the AI GPU market. However, the proliferation of artificial intelligence agents has begun to increase the demand for server processors. For example, applications such as Meta's Muse need the server processor to run a virtual machine and run independent tasks for long periods of time.

Lisa Su said demand will increase significantly as agents take on more complex tasks. As a matter of fact, shares reached a record level in October with these expectations. The company also develops data center GPUs and rack-scale systems called Helios that compete directly with Nvidia.

Giants such as Meta, Microsoft, Anthropic, OpenAI and Oracle are starting to use Helios systems in their data centers. In fact, Meta announced last week that its Helios racks were operational. At the same time, AMD agreed to invest $1 billion in Meta's share issue.

AMD has also committed to investing up to $5 billion in Anthropic. In addition, it announced that it would acquire World Labs in September. An agreement worth $8.2 billion, to be paid entirely in shares, was made for the company founded by Fei-Fei Li. World Labs develops world models that simulate three-dimensional environments for robotics. In addition, Fei-Fei Li will also join AMD.

Game and PC revenues are declining

While AMD data center revenue broke records, the consumer market remained weak. For example, game revenues dropped by 40 percent year-on-year to $773 million. On the other hand, the segment reporting PC and game chips together decreased by 8 percent to 3.7 billion dollars.

Price increases in memory and other components are pushing up computer and console prices. Moreover, according to Counterpoint Research data, global PC shipments decreased by 4 percent in the second quarter. Additionally, Lisa Su stated that increasing costs slowed down sales.

AMD expects annual contraction in the consumer market in 2027. On the other hand, Intel also announced that it did not expect the memory shortage to improve next year. Additionally, SK Hynix predicts that the supply shortage could last until 2030.