AMD’s revenue climbs 50% and data center sales doubled, but the stock is down

AMD reported second-quarter earnings on Tuesday that beat expectations, but the stock slumped in extended trading.

Here’s how the chipmaker did versus LSEG consensus estimates for the quarter ended June 27:

EPS: $1.66, adjusted, versus $1.62 expected

Revenue: $11.54 billion versus $11.28 billion expected

Overall, AMD revenue climbed 50% from $7.69 billion a year ago, a sign of the company’s central position in the market for artificial intelligence chips.

AMD’s Data Center unit is what is driving the company’s growth. Data Center sales were $6.7 billion, up 107% on an annual basis, which the company attributed to central processing unit and graphics processing unit sales.

AMD said it expects about $13 billion in revenue for the current quarter, plus or minus $300 million, versus LSEG expectations of $12.52 billion. Some analysts had been looking for guidance as high as $14 billion.

The company will also start shipping Helios, its first rack AI system, this year to companies like Meta, OpenAI, and Oracle. It’s AMD’s first rack-scale system, which more directly competes with Nvidia systems, not just its chips.