Chip giant AMD (AMD) reported its second-quarter earnings after the bell on Tuesday, surpassing analysts’ expectations on both top and bottom lines. The company also provided an optimistic outlook for the third quarter.
Like its competitor Nvidia, AMD is benefiting from the surge in AI demand, boosting sales of its data center GPUs and CPUs. For the quarter, AMD reported adjusted earnings per share (EPS) of $0.69 and revenue of $5.8 billion, beating Wall Street’s expectations of $0.68 EPS on $5.7 billion in revenue. This marks a significant improvement from last year’s $0.58 EPS on $5.4 billion revenue.
“Our AI business continued accelerating and we are well positioned to deliver strong revenue growth in the second half of the year led by demand for Instinct, EPYC, and Ryzen processors,” AMD CEO Lisa Su stated.
Shares of AMD jumped by over 9% in pre-market trading on Wednesday, with Nvidia and Intel shares also seeing gains.
AMD’s Data Center revenue hit $2.8 billion, surpassing expectations and representing a 115% increase from last year’s $1.3 billion. The company’s top GPU, the MI300X, is already being adopted by major partners like Microsoft, Meta, and Lenovo. AMD announced that the next-generation MI325X will be available in Q4, with the MI350X and MI400 to follow in 2025 and 2026, respectively.
Beyond AI, AMD’s Client segment, which includes PC chip sales, reported $1.5 billion in revenue, up from $998 million last year. This growth reflects a broader recovery in the PC market as consumers begin replacing older pandemic-era purchases.
Gaming revenue was $648 million in Q2, down 59% year-over-year but still slightly above estimates. The gaming industry, like PCs, is recovering from a post-pandemic slowdown, with optimism for future growth fueled by upcoming releases from Nintendo and Take-Two.
AMD is the first of the major chip companies to report earnings this quarter, with Intel and Nvidia following suit later in August.