Advanced Micro Devices (AMD) closed the third quarter of 2026 with record revenue and better‑than‑expected profitability. Revenue rose 45% year‑over‑year to $13.38 billion, topping the analyst consensus of $13.09 billion. Adjusted earnings per share were $2.09 versus the $1.95 expected, representing a 74% increase.
Net income under accounting rules was $2.43 billion, up 95%. Adjusted operating income reached $3.92 billion and operating margin improved from 24% to 29%, indicating that revenue growth is translating increasingly into profit.
Data‑center segment drives growth
Data‑center revenue jumped 97% to $8.55 billion, above the market expectation of $8.2 billion. AMD attributed the surge to strong demand for EPYC server processors and the introduction of Instinct MI450 AI accelerators. The company’s Helios systems are positioned to compete with full‑rack server solutions offered by competitors such as Nvidia. The platform ties next‑generation server CPUs and AI accelerators together, and AMD expects production ramp‑up to accelerate in the fourth quarter. Early Helios systems are already running workloads for Microsoft and OpenAI.
Other segments and guidance
Combined PC and gaming revenue fell 8% to $3.72 billion. Within that grouping, PC sales rose 7% while gaming revenue declined 40%. Embedded systems revenue grew 29% to $1.11 billion.
For the fourth quarter AMD issued revenue guidance of $17 billion, plus or minus 3%; the midpoint implies 66% year‑over‑year growth and exceeds analysts’ $16.23 billion expectation. Adjusted gross margin is expected to be 55%, down slightly from the third‑quarter level of 56%.
CEO Lisa Su said the company’s total revenue could increase by more than 80% by 2027 (analyst consensus assumes 77% growth). Management expects data‑center products could account for roughly 80% of sales next year. At the same time, the company projects a double‑digit market decline in PC shipments by 2027 but believes AMD will outperform that market contraction.
Market reaction
AMD shares rose about 5% in after‑hours trading following the earnings release. Investors were encouraged by stronger results and the outlook for data‑center growth; peer stocks including Nvidia and Intel also gained after the report.
This article is not investment advice or a recommendation.
