Key facts
- AMD's third-quarter adjusted profit was $2.09 per share, against an estimate of $1.95.
- AMD expects an adjusted gross margin of about 55% in the fourth quarter, down from 56% in the third.
- Client and gaming segment revenue fell 8% to $3.72 billion, missing the $3.79 billion estimate.
- AMD's Helios rack, combining the MI455X accelerator and Venice server chips, is in production, with initial systems being tested at Meta.
- AMD said the industry faces a global memory shortage that leaves high-bandwidth memory used in AI processors in scarce supply.
AMD forecast fourth-quarter revenue of about $17 billion, plus or minus 3%, on November 3, above the $16.23 billion average analyst estimate compiled by LSEG. The company said demand for its chips is being driven by a shift in AI workloads toward running models in real-world applications.
The forecast followed third-quarter revenue of $13.38 billion, up 45% and above the $13.09 billion estimate. Data-center revenue rose 97% to a record $8.55 billion, beating the $8.20 billion estimate, and adjusted profit was $2.09 per share against $1.95 expected.
AMD expects an adjusted gross margin of about 55% in the fourth quarter, compared with an estimate of 55.27% and down from 56% in the third quarter. Third-quarter revenue in its client and gaming segment, which houses PC chips and console processors, fell 8% to $3.72 billion, missing the $3.79 billion estimate.
AMD said its flagship Helios rack, which combines its MI455X accelerator and new Venice server chips, is in production and set for a larger ramp-up in the fourth quarter, with initial systems being tested at Meta. In February the company agreed to sell up to $60 billion of AI chips to Meta over five years, in a deal that allows Meta to buy as much as 10% of the chipmaker.
AMD said the semiconductor industry is also grappling with a global memory shortage, leaving high-bandwidth memory used in AI processors in scarce supply as manufacturers race to increase production. In September, AMD agreed to buy World Labs, a startup building AI that models 3D environments, for $8.2 billion in stock.
AMD said it captured market share from rival Intel, which forecast quarterly revenue well below estimates and triggered a global selloff in chip stocks. AMD shares have more than doubled so far this year, and the company briefly entered the $1 trillion market capitalization club.