Advanced Micro Devices delivered a first-quarter earnings beat that sent shares soaring to fresh highs, fueled by a dramatic upgrade to its long-term data center growth forecast and the addition of Meta as a marquee customer for its next-generation chips.
The chipmaker reported revenue of $10.25 billion for the three months ended March 2026, a 38 percent jump from a year earlier and comfortably ahead of the $9.89 billion analysts had penciled in. Adjusted earnings per share came in at $1.37, topping the $1.29 consensus estimate. The stock surged more than 18 percent in regular trading on Wednesday, hitting €359.10 — a new 52-week peak — after earlier climbing as much as 12 percent in after-hours action following the release.
The headline figure was powered by a record performance in the data center segment, where revenue rose 57 percent to $5.8 billion. AMD’s EPYC server processors and Instinct graphics accelerators continued to capture surging demand from hyperscale cloud operators and enterprises racing to deploy artificial intelligence infrastructure.
That momentum now has a powerful new backer. Meta plans to deploy AMD accelerators based on the upcoming MI450 architecture, with total compute capacity reaching as high as six gigawatts. The social media giant also becomes the first major customer for the sixth generation of EPYC processors, marking a significant competitive win for AMD against longtime rival Intel.
A Sharper Lens on the Server Market
Chief Executive Lisa Su used the earnings call to dramatically revise upward the company’s view of the total addressable market for server CPUs. AMD now expects the segment to grow at an annual rate exceeding 35 percent through 2030 — nearly double the 18 percent projection it offered just last November. That trajectory would push the market past $120 billion by the end of the decade.
The revision reflects a shift in AI workloads from training to large-scale inference, as well as the emergence of agentic AI applications that require continuous, real-time computation. The company’s hardware pipeline is aligned accordingly: the MI450 accelerators and the Helios rack platform have drawn customer orders that exceed internal expectations, according to management.
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On the software front, AMD released ROCm 7.2.3 on May 4, an update that improves profiling accuracy for inference workloads. The release also documents ROCm XIO, a new interface that enables direct data transfer from accelerators to NVMe SSDs and RDMA network cards without involving the host processor — a design aimed at reducing idle time and improving system stability during inference.
Broad-Based Gains, With One Cloud on the Horizon
Beyond data centers, AMD’s other divisions posted solid results. The client segment, powered by Ryzen processors, grew 26 percent to $2.9 billion. Gaming revenue rose 11 percent to $720 million, while the embedded business added 6 percent to $873 million. Free cash flow more than tripled to $2.6 billion.
But management sounded a cautious note on gaming, warning that second-half revenue in that segment could decline more than 20 percent compared with the first half. The message was unmistakable: AMD’s growth story now runs through enterprise and AI infrastructure, not consumer hardware.
For the current quarter, AMD guided for revenue of approximately $11.2 billion, representing year-over-year growth of about 46 percent. The adjusted gross margin is expected to widen to 56 percent, up from 55 percent in the first quarter.
Analysts have responded swiftly. Bernstein upgraded the stock to “Outperform” with a price target of $525, citing AMD’s strengthening competitive position. The shares have roughly doubled since the start of the year, and the new data center forecast suggests the runway may be longer than many on Wall Street had anticipated.
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