Photo: Genevieve Martin / Oak Ridge National Laboratory (CC BY 2.0). AMD CEO Lisa Su in 2019.
Advanced Micro Devices shares jumped about 8% on Wednesday after the chipmaker posted the biggest quarter in its history and told investors the current one will be even bigger, Yahoo Finance reported. It was the clearest sign yet that the artificial-intelligence building boom that became a flashpoint in Tuesday’s midterm elections is still pulling in enormous money.
AMD’s third-quarter revenue reached a record $13.4 billion, up 45% from a year earlier, and adjusted profit of $2.09 a share beat the $1.94 Wall Street expected, the company announced. The engine is AMD’s data-center business – the chips that fill the giant computing halls powering AI – where sales nearly doubled to a record $8.5 billion.
“Demand for our Instinct and EPYC products continued to strengthen, and we expect growth to accelerate further in the fourth quarter as we scale Helios and ‘Venice’ production,” CEO Lisa Su said, naming AMD’s AI chips and server processors. The company forecast roughly $17 billion in revenue this quarter, well above the $16.23 billion analysts had penciled in, which would be growth of about 66% from a year ago.
In plain terms: when Meta, Microsoft, OpenAI, Oracle or Anthropic builds a new AI data center, more of the bill is going to AMD. The company said all five are already running work on its newest Helios systems, and Meta signed an agreement earlier this year worth about $60 billion for AMD chips to power its AI expansion, a market long dominated by rival Nvidia.
For anyone with a 401(k), this is the other side of the data-center story. The same construction wave that drove up power bills and turned data centers into a campaign issue in Texas, Ohio and beyond is producing record sales for the companies supplying it. AMD’s stock has more than doubled this year – even after a 17.5% slide in October, when investors worried the AI spending spree had gotten ahead of itself – while Nvidia is up about 11% and the S&P 500 about 10%.
Wednesday’s results answered some of those worries. Analysts at Baird told clients that AMD’s forecast implies its server-processor revenue more than doubles again by 2027, a sign the company is steadily taking business in a market where, only a few years ago, it was an afterthought.
JBizNews Desk | New York
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