AMD Shares Surge 7% in After-Hours Trading
AMD shares surged more than 7% in after-hours trading immediately following its earnings announcement. On Tuesday (local time), the U.S. chipmaker reported third-quarter results that beat market expectations, driven by growing demand for its artificial intelligence (AI) semiconductors. Revenue, net income, and even its fourth-quarter guidance all exceeded forecasts.
AMD reported third-quarter revenue of $13.38 billion, up 45% from $9.25 billion a year earlier, topping the $13.09 billion consensus estimate from market research firm LSEG. Adjusted earnings per share (EPS) came in at $2.09, also surpassing the expected $1.95.
The data center business was the key driver of growth. Data center revenue soared 97% year-over-year to $8.55 billion, an all-time high. As a result, the segment's share of total revenue jumped from 47% a year ago to 64%.
AMD said it expects fourth-quarter revenue of roughly $17 billion, above the market consensus of $16.2 billion. However, it guided for a gross margin of 55% — lower than the 56% posted in the third quarter and slightly below the market expectation of 55.3%.
AMD's strong results coincide with shifting demand in the AI market. The recent spread of AI agent services has boosted demand for central processing units (CPUs) as well, with the server CPU business emerging as a new growth driver. Riding the surge in AI agent demand, AMD's stock hit an all-time high in October.
