AMD stock rises after Q3 earnings beat, as data center revenue climbs 97%
AMD reported its third quarter earnings after the bell Tuesday.
AMD ( AMD ) reported its third quarter results after the bell on Tuesday, beating expectations on the top and bottom lines, as the company's data center revenue grew 97%.
AMD stock climbed more than 7% following the news.
"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 in a statement.
"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."
For the quarter, AMD saw earnings per share (EPS) of $2.09 on revenue of $13.38 billion. Analysts were projecting EPS of $1.97 on revenue of $13.08 billion, according to Bloomberg consensus estimates.
The company saw EPS and revenue of $1.20 and $9.2 billion, respectively, in the same period last year.
AMD's Data Center arm generated sales of $8.5 billion, ahead of estimates of $8.19 billion. It reported revenue of $4.34 billion in the same period last year.
AMD's Client business revenue, which includes PC sales, hit $2.9 billion. Wall Street was looking for $3.06 billion.
The chipmaker's gaming business sales, however, came in at $773 million, down 40% year over year. Analysts were estimating revenue of $655 million.
The company's gaming division includes products ranging from PC graphics cards to custom silicon for game consoles. Both categories are facing higher prices due to the ongoing memory and storage shortage, depressing customer demand.
AMD's report comes after rival Intel reported better-than-anticipated Q3 results , but issued guidance well below analysts' projections last week. The news sent Intel stock plummeting nearly 29% .
The company blamed the outlook on a worse-than-anticipated decline in the PC market.
The industry is contending with two overlapping factors: difficult comparisons to last year, when Microsoft ended support for Windows 10, forcing enterprises to purchase newer Windows 11 systems, and the steady increase in PC prices, which is eating into demand.
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