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AMD stock rose sharply after Advanced Micro Devices reported stronger first-quarter earnings and issued a second-quarter revenue forecast above Wall Street estimates. The chipmaker gained from rising demand for data center processors and AI accelerators, while investors also watched management’s comments on supply, gaming weakness, and future server growth.
Advanced Micro Devices reported first-quarter revenue of $10.25 billion, up 38% from $7.43 billion a year earlier. The result came above analyst estimates of about $9.89 billion. Adjusted earnings reached $1.37 per share, compared with expectations of $1.28 per share.
The company also posted GAAP net income of about $1.4 billion, while diluted earnings per share rose to 84 cents. AMD said gross margin improved to 53% on a GAAP basis and 55% on a non-GAAP basis. The results pushed AMD stock higher in premarket trading on Wednesday, with the shares rising more than 18% after the report.
AMD’s data center segment remained the main growth driver. Revenue in the unit rose 57% year over year to $5.8 billion, ahead of market expectations. AMD said the increase came from strong demand for EPYC server processors and higher shipments of Instinct AI products.
Chief Executive Lisa Su linked the quarter to AI infrastructure demand. She said, “AI inference and agentic AI are driving demand” for high-performance CPUs and accelerators. However, the company still faces pressure to scale supply as large cloud customers increase orders for server chips and AI hardware.
AMD is also preparing to expand its Helios rack-scale AI platform. The system combines AMD Instinct GPUs, EPYC CPUs, and networking parts in a full server rack. The company expects broader shipments in the second half of 2026, with demand tied to hyperscale AI infrastructure buildouts.
AMD guided for second-quarter revenue of about $11.2 billion, plus or minus $300 million. That range sits above Wall Street’s estimate of about $10.52 billion and would mark strong year-over-year growth if achieved.
The forecast helped lift investor confidence after the earnings release. Management said server CPU revenue should grow faster as AMD expands production and meets rising customer demand. Still, supply access remains a factor because AMD depends on Taiwan Semiconductor Manufacturing Company for chip production.
The company also expects non-GAAP gross margin near 56% in the second quarter. That would show further margin growth from the first quarter, supported by a richer product mix in data center and embedded chips.
AMD’s client business brought in $2.9 billion, above analyst expectations of $2.73 billion. The company said Ryzen processor demand supported the segment, helped by stronger adoption from major PC makers.
Gaming revenue reached $720 million, also above forecasts. However, AMD warned that higher memory and component costs may weigh on gaming demand later in the year. The company expects second-half gaming revenue to fall by more than 20% compared with the first half.
The results show AMD gaining from AI server demand while managing weaker consumer hardware trends. The next test will be whether the company can scale Helios shipments, expand server CPU supply, and protect margins as AI spending remains closely watched.
Also Read: Alphabet, Amazon, & Microsoft Increase AI Spending as Quarterly Earnings Reflect Strong Momentum
