The data center business did most of the work. Its revenue rose 97% to a record $8.5 billion, which is 64% of AMD's sales, up from 47% a year ago. Operating income in the unit climbed 168% to $2.9 billion. Chair and CEO Lisa Su attributed the growth to record sales of EPYC server processors and Instinct AI accelerators, and cloud and enterprise sales more than doubled. Volume shipments of the MI455X accelerator began in the quarter to customers including Anthropic, Meta, Microsoft and OpenAI. Those four and Oracle are adopting AMD's Helios rack-scale systems, and Meta has confirmed its racks are running. Su said agentic AI workloads are a major driver of compute demand, noting that more than 10 million people activated Meta's Muse agents in their first six weeks.

Other parts of the business were weaker. Gaming revenue fell 40% to $773 million on lower semi-custom chip sales, and client revenue rose 7% to $2.9 billion. Combined, the two segments brought in $3.7 billion, down 8%. Embedded revenue grew 29% to $1.1 billion. Across the company, non-GAAP operating income hit a record $3.9 billion on a gross margin of 56%, while operating expenses rose 29% to $3.6 billion, driven by research and development.

AMD is also putting money into its customers. It agreed to invest $1 billion in Meta's equity offering and committed up to $5 billion in Anthropic. It announced agreements to acquire World Labs and Taalas, both expected to close by the end of 2026, to add spatial intelligence and low-latency inference capabilities. The World Labs deal, announced in September, is all-stock and valued at $8.2 billion. AMD began revenue shipments of its Venice EPYC processors in the quarter and has logged more than 240 platform commitments, with cloud providers planning instance rollouts for early 2027.

The balance sheet has grown with the build-out. Inventory rose 35% to $11.5 billion to support production ramps. Total debt rose to $7.1 billion after a $4.75 billion senior notes offering in August, against $15.8 billion in cash and short-term investments.

For the fourth quarter, AMD guided to revenue of about $17 billion, up roughly 66% from a year earlier, with a gross margin of 55%. Analysts had been looking for $16.2 billion to $16.3 billion. The company expects data center revenue to grow more than 50% from the third quarter. Morningstar estimates GPU revenue of $7.5 billion, which could top server CPU revenue for the first time. For 2027, AMD expects total revenue to grow more than 80%, with data center above 80% of the total. It also expects PC unit shipments to fall by a double-digit percentage next year because of higher component costs.

Su said AMD has secured the wafers, substrates and advanced packaging that growth requires. She said the company plans to "substantially increase our supply in 2027" after meetings with suppliers including Taiwan Semiconductor Manufacturing Company, SK Hynix and Samsung.

AMD shares closed regular trading Tuesday up 3.65% at $483.90 and rose about 7% after hours. The stock is up 129% this year despite a recent industry-wide sell-off over fears about AI spending. Morningstar raised its fair value estimate to $570 from $530, expecting server CPU revenue to grow more than 100% in 2027 and GPU revenue to more than double.