Advanced Micro Devices (NASDAQ: AMD) reported stronger-than-expected third-quarter 2026 earnings, November 3, supported by surging demand for data center processors and AI infrastructure. Revenue increased 45% year over year, while data center sales nearly doubled.
AMD shares rose approximately 8% in extended trading following the announcement, reversing recent losses amid broader concerns about excessive spending on artificial intelligence infrastructure.
- AMD’s third-quarter revenue rose 45% to $13.38 bn, beating the $13.09 bn consensus estimate, while adjusted earnings reached $2.09 per share.
- Data center revenue surged 97% to $8.55 bn, accounting for 64% of total sales as demand for server processors and agentic AI infrastructure increased.
- AMD shares gained 8% in extended trading after the company forecast approximately $17 bn in fourth-quarter revenue, above analysts’ $16.2 bn estimate.
The chipmaker reported adjusted earnings of $2.09 per share, exceeding the $1.95 expected by analysts surveyed by LSEG. Revenue reached $13.38 bn, compared with the consensus forecast of $13.09 bn and $9.25 bn in the same quarter a year earlier.
CEO Lisa Su said demand for data center processors should continue strengthening, expressing confidence that the company can meet customers’ growing requirements.
With our leadership product portfolio and deep customer and supply chain relationships, we are confident in our ability to sustain very strong revenue growth and expanding profitability over the coming years.
Lisa Su, AMD CEO
AMD’s adjusted operating margin reached 29%, ahead of the 28% expected by analysts. AMD stock price forecast: Wall Street analysts target $800 before earnings.
AMD data center revenue jumps 97% to $8.55 bn
AMD’s data center business generated $8.55 bn in third-quarter revenue, an increase of approximately 97% from a year earlier.
The segment accounted for 64% of total revenue, compared with 47% in the previous year, making it the largest contributor to AMD’s financial performance.
Growth reflects rising demand for server central processing units (CPUs) and AI computing infrastructure, particularly as enterprises introduce more autonomous AI applications.
After years of competing with Nvidia (NASDAQ: NVDA) in the market for AI graphics processing units (GPUs), AMD is also benefiting from renewed demand for traditional server CPUs.
The emergence of agentic AI applications, including Meta’s Muse, has increased the importance of processors capable of supporting virtual machines and running autonomous workloads for extended periods.
Unlike conventional AI interactions that process individual requests, agentic applications can operate independently for hours, requiring substantial CPU computing capacity.
“Adoption is just starting, and we expect demand to grow sharply as agents are deployed more broadly and take on more complex work,” Su told analysts during the earnings call.
Growing interest in agentic AI helped push AMD shares to a record high in October.
AMD outperforms Intel despite concerns about AI infrastructure spending
AMD’s results followed a similarly strong increase in data center revenue at Intel (NASDAQ: INTC), which reported 78% growth in the segment during the third quarter. Investor reactions to the two companies differed sharply.
Intel shares plunged 29% on Friday following concerns about weaker guidance and the company’s ability to meet demand, particularly amid questions surrounding its manufacturing operations.
AMD, meanwhile, benefited from stronger-than-expected results and an optimistic fourth-quarter revenue forecast.
Patrick Moorhead, founder, CEO and chief analyst at Moor Insights & Strategy, told Yahoo Finance that AMD’s earnings demonstrated how significantly its business had shifted toward data center computing.
He noted that data center revenue had increased 97% and represented nearly two-thirds of overall sales.
Moorhead argued that investors had initially applied Intel’s weaker PC market outlook to AMD, despite the latter’s substantially greater exposure to data center demand.
He characterized AMD as primarily a data center company with a PC business, rather than a traditional PC processor manufacturer.
AMD shares had risen approximately 125% since the beginning of 2026 but declined for three consecutive sessions before Tuesday’s rebound, amid an industrywide technology sell-off driven by concerns about AI capital expenditure.
AMD PC and gaming revenue declines as consumer market weakens
AMD continues to face challenges in the personal computer market, where higher component costs and weaker demand have affected manufacturers.
The company competes with Intel in traditional x86 processors used in desktops and laptops. Other manufacturers rely on Arm-based processors supplied by companies including Qualcomm and Apple.
According to Counterpoint Research, global PC shipments fell 4% year over year in the second quarter of 2026 as rising prices for memory and other components weighed on the market.
Intel cited weakness in the PC market as a factor behind its disappointing outlook.
AMD reports its PC processor business together with gaming products. Combined revenue from the segment declined 8% year over year to $3.7 bn during the third quarter.
Gaming revenue fell 40% compared with the same period in 2025. The decline contrasted with accelerating data center growth, reinforcing the increasing contribution of enterprise computing and AI infrastructure to AMD’s overall results.
AMD forecasts $17 bn in Q4 revenue, beating Wall Street estimates
AMD expects fourth-quarter 2026 revenue of approximately $17 bn, exceeding the $16.2 bn average analyst estimate compiled by LSEG. The outlook suggests continued strong demand for data center processors through the end of the year.
The company forecasts a fourth-quarter gross margin of approximately 55%, slightly below the 55.3% consensus estimate reported by StreetAccount.
Although the margin guidance fell marginally short of expectations, investors responded positively to the revenue forecast and the acceleration in data center sales.
Moorhead described AMD’s results as particularly strong, pointing to the scale of its data center growth and fourth-quarter guidance that exceeded market expectations.
The results also demonstrated a widening difference between AMD’s expanding AI infrastructure business and its weaker consumer computing operations.
With data center products now generating 64% of revenue, AMD’s near-term growth is increasingly dependent on enterprise server demand and the adoption of AI workloads, including autonomous agents that require sustained computing resources.
