AMD posts record $11.5B quarterly revenue as data center sales more than double

Advanced Micro Devices ↘ 1.47% reported record second-quarter 2026 revenue of $11.54 billion on Tuesday, a 50% year-over-year increase driven by surging demand for AI infrastructure, even as shares fell on Wednesday as investors weighed whether the chipmaker can close the gap with Nvidia ↘ 1.47% in the AI accelerator market.

Data Center Dominance

AMD's data center segment delivered $6.7 billion in revenue, a 107% year-over-year increase that now accounts for 58% of total company revenue, up from 42% a year ago. The results were powered by demand for EPYC server processors and Instinct AI GPUs as hyperscale providers and enterprises expand AI deployments.itpro+1

"We delivered an excellent quarter, with record revenue and profitability as data center revenue more than doubled year-over-year," CEO Lisa Su said in a statement. Adjusted earnings per share came in at $1.66 on revenue that beat Wall Street expectations of $11.28 billion, according to LSEG data.theglobeandmail+1

Su guided third-quarter revenue to approximately $13 billion, above analyst estimates of $12.52 billion, and projected data center sales would double again in 2027, with server revenue growing more than 80% in the second half of 2026.gamesbeat+1

Shares Slide on Elevated Expectations

Despite the beat, AMD shares fell roughly 6% in Wednesday's opening trade. The selloff deepened after SpaceX CEO Elon Musk publicly committed to building computing infrastructure exclusively on Nvidia chips, calling Nvidia's Vera Rubin "the best architecture."stocktwits+2

"We suspect expectations had moved higher following Intel's ↘ 1.02% results a couple of weeks ago, and the buyside already has a fairly bullish outlook," said Stacy Rasgon, analyst at Bernstein, according to a Reuters report carried by Free Malaysia Today.freemalaysiatoday

Su addressed the competitive dynamics during a CNBC interview on Wednesday, emphasizing AMD's expanding customer base. The company is working directly with Meta, OpenAI, and Anthropic to optimize AI models on its open-source ROCm software platform, with open-source contributions up tenfold in the past year.businessinsider+1

Gaming Weakness, AI Strength

While data center boomed, AMD's gaming segment declined 31% year-over-year to $779 million due to the maturing console cycle and rising component costs that have pushed graphics card prices higher. CFO Jean Hu said the company expects a "strong double-digit decline in gaming" to continue through the second half.tomshardware+1

AMD's Helios rack-scale AI system, which combines EPYC CPUs, Instinct GPUs, and Pensando networking, has secured commitments from Microsoft ↗ 0.52%, Meta ↗ 1.02%, Oracle ↘ 3.11%, and others, with shipments expected to ramp in the fourth quarter. TD Cowen analysts noted AMD stock faced a "very high bar" following recent AI customer announcements and a sharp rally that has lifted shares more than 128% year-to-date.itpro+1