AMD 2026 Q2

Management raised its total addressable market outlook, saying the data center AI accelerator market will grow over 45% annually to ~$1.4T by 2030 and server CPU TAM to ~$220B, far above projections made just six months ago.

“the overall data center market opportunity is expanding far more rapidly than we projected just 6 months ago”— Lisa Su, Chair and CEO

AMD is tracking materially ahead of its long-term financial model from last November's Analyst Day, now expecting revenue growth substantially above the prior >35% target and EPS to significantly exceed the $20 goal.

“we are tracking materially ahead of the long-term financial model we shared at our Financial Analyst Day last November”— Lisa Su, Chair and CEO

Management now expects the entire data center segment revenue to more than double year-over-year in 2027, combining >70% server growth with well over 100% data center AI growth, a steeper trajectory than previously communicated.

“we now expect data center segment revenue to more than double year-over-year in 2027”— Lisa Su, Chair and CEO

Server CPU revenue outlook was raised to more than 80% year-over-year growth in the second half of 2026 and more than 70% for full year 2027, driven by stronger demand and improved supply versus prior expectations.

“we now expect server revenue to grow more than 80% year-over-year in the second half of 2026”— Lisa Su, Chair and CEO

Data center revenue more than doubled year-over-year and now represents 58% of total revenue, up sharply from 42% a year ago, reflecting a major shift in business mix toward server and AI compute.

“Data center revenue more than doubled year-over-year and now represents 58% of total revenue, up from 42% a year ago”— Lisa Su, Chair and CEO

Customer demand for the new Venice EPYC generation is described as stronger than for any prior EPYC generation, positioning AMD for continued share gains across cloud and enterprise in coming quarters.

“Customer demand for Venice is stronger than for any prior EPYC generation”— Lisa Su, Chair and CEO

Cloud and enterprise server sales each grew more than 70% year-over-year, exceeding the outlook management had provided the prior quarter.

“cloud and enterprise sales each growing more than 70% year-over-year, exceeding the outlook we provided last quarter”— Lisa Su, Chair and CEO

AMD is tracking toward another record year of design wins exceeding $18 billion, led by networking, data center, communications, test, and defense customers, signaling accelerating future revenue conversion.

“We are tracking towards another record year with more than $18 billion of new design wins”— Lisa Su, Chair and CEO

Enterprise on-premise adoption accelerated, driven by EPYC's leadership performance and TCO advantages, delivering a fourth consecutive quarter of record sell-through.

“on-prem adoption accelerated driven by the leadership performance and TCO advantages of our EPYC portfolio”— Lisa Su, Chair and CEO

AMD announced a new strategic partnership with Anthropic to deploy up to 2 gigawatts of MI450-series GPUs in Helios, with the first gigawatt beginning deployment in the first half of 2027, a new large-scale customer commitment.

“Anthropic will deploy up to 2 gigawatts of MI450 series GPUs in Helios”— Lisa Su, Chair and CEO

Microsoft expanded its partnership with AMD to deploy Helios at scale on Azure for frontier model inferencing across its own and customer AI services, broadening AMD's cloud provider footprint.

“Microsoft will deploy Helios at scale on Azure for frontier model inferencing across Microsoft, its AI customers and Azure AI services”— Lisa Su, Chair and CEO

AMD entered a new partnership with Cerebras combining Helios with Cerebras' wafer-scale engine for fast inference, expected to become available in the Cerebras cloud in Q4 and extend into 2027.

“we would expect that solution to start becoming available in Q4 in the Cerebras cloud and extend into 2027”— Lisa Su, Chair and CEO

Customer pull for the new Helios rack-scale AI platform is tracking ahead of AMD's initial volume forecast, reflecting stronger-than-expected demand ahead of ramp beginning this quarter.

“Customer pull for Helios is very strong and tracking ahead of our initial forecast”— Lisa Su, Chair and CEO

Management said the ROCm software stack has reached an important inflection point, now having the performance, capabilities and developer experience needed to deploy AI in production at scale, a shift from earlier maturity concerns.

“ROCm has reached an important inflection point with the performance, capabilities and developer experience customers need to deploy AI in production at scale”— Lisa Su, Chair and CEO

AMD expects its next-generation MI500 series to deliver the largest generational leap in Instinct history, putting the company on track to increase inferencing performance more than 2,000x in four years.

“We expect MI500 to deliver the largest generational leap in Instinct history”— Lisa Su, Chair and CEO

Gross margin expanded to 56%, up over 200 basis points year-over-year and 80 basis points sequentially, reflecting favorable product mix and growing data center contribution.

“Gross margin for the quarter expanded to 56%, up over 200 basis points year-over-year and 80 basis points sequentially”— Jean Hu, Executive Vice President, CFO and Treasurer

CFO said the recovering Embedded business will provide an additional gross margin tailwind in 2027, supplementing the offsetting dynamics between growing server CPU and data center AI mix.

“we actually think the Embedded business will give us additional tailwind on the gross margin side in 2027”— Jean Hu, Executive Vice President, CFO and Treasurer

Management committed to managing operating expense growth below the pace of revenue growth going forward, aiming to drive greater operating leverage and EPS well above the prior $20 target.

“you should expect us to manage this OpEx increase less than the top line revenue growth”— Jean Hu, Executive Vice President, CFO and Treasurer

Client and Gaming segment operating margin fell to 15% from 21% a year ago, due to continued investment in go-to-market activities and an expanding product roadmap.

“reflecting continued investment in go-to-market activities and an expanding product roadmap”— Jean Hu, Executive Vice President, CFO and Treasurer

Embedded segment operating margin improved to 40% of revenue from 33% a year ago, driven by higher revenue and a more favorable product mix.

“driven by higher revenue and favorable product mix”— Jean Hu, Executive Vice President, CFO and Treasurer

AMD gained x86 server revenue share year-over-year as customers expanded deployments of both fifth-gen EPYC Turin and fourth-gen EPYC Genoa.

“We gained x86 server revenue share year-over-year as customers expanded deployments of both fifth-gen EPYC Turin and fourth-gen EPYC Genoa families”— Lisa Su, Chair and CEO

Management expects to continue growing market share across cloud and enterprise server markets in coming quarters as Venice's broader workload support expands beyond what Turin captured.

“we expect to continue growing market share across cloud and enterprise in the coming quarters”— Lisa Su, Chair and CEO

Higher industry-wide component costs pushed up graphics card prices, which weighed on gaming graphics demand and contributed to a year-over-year revenue decline in that category.

“higher industry-wide component costs contributed to higher graphics card prices and weighed on overall demand”— Lisa Su, Chair and CEO

Management shifted to planning for a softer PC market in the second half of the year as higher memory and component costs weigh on demand, a more cautious view than prior commentary.

“we are planning for a softer PC market as higher memory and component costs weigh on demand”— Lisa Su, Chair and CEO

Rising memory costs are prompting customers to optimize HBM and memory footprints in AI systems, with AMD indicating it could adjust memory configurations if TCO benefits diminish for certain workloads.

“every customer is looking at how to optimize their memory footprint”— Lisa Su, Chair and CEO