Why did data centre sales more than double at Advanced Micro Devices (AMD)?

Sonal Goyal

28 October 2026 05:00 PM AEDT

Why did data centre sales more than double at Advanced Micro Devices (AMD)?

Image Source: Shutterstock

You are reading a free article with opinions that may differ from the recommendation given by Kalkine in its paid research reports. Become a Kalkine member today to get access to our research reports, in-depth technical and fundamental research. Learn more

Start Your Free Trial Now!

Key Highlights

AMD reported second-quarter 2026 Revenue of USD 11.5 billion, up 50 per cent year on year and 13 per cent on the first quarter.
Data Center revenue rose 107 per cent to USD 6.718 billion, 58 per cent of the total.
Third-quarter revenue is guided to about USD 13 billion, plus or minus USD 300 million, with non-GAAP gross Margin of about 56 per cent.

Data centre more than doubles

Advanced Micro Devices, Inc. (NASDAQ:AMD) reported second-quarter 2026 results on 4 August 2026. Revenue was USD 11.5 billion, up 50 per cent year on year and 13 per cent on the first quarter. Chief executive Lisa Su said the quarter delivered the company's highest revenue and profitability to date.

The Data Center segment generated USD 6.718 billion, up 107 per cent and 58 per cent of the total. Client and Gaming revenue was USD 3.841 billion, up 6 per cent: Client rose 23 per cent to USD 3.062 billion, while Gaming fell 31 per cent to USD 779 million on lower semi-custom revenue. Embedded revenue rose 19 per cent year on year to USD 977 million.

Profit and cash flow

GAAP gross margin was 54 per cent and non-GAAP gross margin 56 per cent. GAAP Operating Income was USD 1.99 billion, a 17 per cent margin, while non-GAAP operating income was USD 3.094 billion, a 27 per cent margin. GAAP Net Income rose 163 per cent to USD 2.297 billion, or USD 1.38 per diluted share. Non-GAAP net income rose 253 per cent to USD 2.76 billion, or USD 1.66 per share.

The year-on-year growth rates are affected by the prior-year base. The company noted that the second quarter of 2025 included USD 800 million of inventory and related charges linked to United States export controls on the Instinct MI308 product.

Free Cash Flow was USD 1.558 billion, a 14 per cent margin, and Operating Cash Flow from continuing operations was USD 2.366 billion, with adjusted EBITDA of USD 3.315 billion. Cash and short-term investments totalled USD 13.111 billion against total Debt of USD 3.226 billion. AMD repurchased no shares in the quarter, and USD 221 million in the first half.

Products, partners and outlook

The company launched its Helios rack-scale AI system and the Instinct MI400 Series, including the MI455X and MI430X, and introduced sixth-generation EPYC server processors. It listed customers deploying Helios as including Anthropic, Meta, Microsoft, OpenAI and Oracle, among others.

It also announced a strategic Partnership with Anthropic to deploy up to 2 gigawatts of MI450 Series GPUs in Helios racks, and an expanded collaboration with Microsoft to deploy Helios racks at scale on Azure. Commercial terms were not given in the material reviewed. In PCs and gaming, it introduced Ryzen AI Halo systems and Ryzen PRO 9000 Series processors with 3D V-Cache, and in embedded it launched the Ryzen AI Embedded X100 Series. It also acquired MEXT, which adds AI-driven predictive memory technology.

For the third quarter of 2026, AMD guided to revenue of about USD 13 billion, plus or minus USD 300 million, with non-GAAP gross margin of about 56 per cent. Chief financial officer Jean Hu said she expects Data Center sales to accelerate in the second half of 2026.

What to watch

Points to monitor include whether Data Center growth accelerates as management expects, how gross margin evolves as rack-scale systems ramp, and whether Gaming weakness persists next quarter.

FAQs

Q: What were AMD's second-quarter 2026 results?

A: Revenue was USD 11.5 billion, up 50 per cent year on year. GAAP net income was USD 2.297 billion, or USD 1.38 per diluted share, and non-GAAP net income was USD 2.76 billion, or USD 1.66 per share.

Q: How did AMD's segments perform?

A: Data Center revenue rose 107 per cent to USD 6.718 billion, and Embedded rose 19 per cent to USD 977 million. Client rose 23 per cent while Gaming fell 31 per cent to USD 779 million.

Q: What is AMD's third-quarter guidance?

A: AMD guided to revenue of about USD 13 billion, plus or minus USD 300 million, with non-GAAP gross margin of about 56 per cent.

Download Free Report – Explore 3 Stock Ideas & Industry Insights

Unlock 3 stock ideas and key industry insights in our free report. This information is general in nature and does not consider your personal objectives, financial situation, or needs. It is not financial advice.

All investments involve risk—consider independent advice before making any investment decisions.

View 3 Research Reports

Disclaimer:

This article (“Article”) has been prepared by Kalkine Pty Limited (ABN 34 154 808 312) (Australian financial services licence number 425376) (“Kalkine”) and its related bodies corporate who are authorised to provide general financial product advice. Kalkine.com.au and its associated pages are published by Kalkine.

Any information/advice provided in this article is general in nature and does not take into account your objectives, financial situation or needs. You should therefore consider whether the information is appropriate for your objectives, financial situation and needs before acting upon it.

There may be a Product Disclosure Statement, Information Memorandum or other offer document (“Offer Document”) for the securities or other financial products referred to in Kalkine articles. You should obtain a copy of the Offer Document and consider it before making any decision about whether to acquire the security or financial product.

Kalkine strongly recommends that you seek advice from a financial adviser, stockbroker or other professional (including taxation and legal advice) before acting on any advice/information in this Article or on the Kalkine website. Not all investments are appropriate for all people.

The information in this Article and on Kalkine website has been prepared from a wide variety of sources, which Kalkine, to the best of its knowledge and belief, considers accurate. Kalkine has made every effort to ensure the reliability of the information contained in its articles (including this Article), newsletters and websites. All information represents our views at the date of publication and may change without notice.

The information in this Article does not constitute an offer to sell securities or other financial products or a solicitation of an offer to buy securities or other financial products.

Kalkine does not issue, sell or deal in any financial products.

This Article may contain information on past performance of particular investments. Please note past performance is neither an indicator nor a guarantee of future performance.

To the extent permitted by law, and excluding any dishonesty or gross negligence by Kalkine, Kalkine disclaims and excludes all liability for any direct, indirect, implied, punitive, special, incidental or other consequential loss or damage arising from the use of or reliance on this Article, the Kalkine website and any information published on the Kalkine website without any warranties or representations by Kalkine to you. To the extent the law prohibits or limits this exclusion, Kalkine limits its liability to the resupply of services.

Please also read our Terms & Conditions and Financial Services Guide for further information.

Employees and/or associates of Kalkine and its related entities may hold interests in the securities or other financial products covered in this Article or on the Kalkine website. Any such employees and associates are required to comply with certain safeguards, procedures and disclosures as required by law.

Some of the images/music that may be used in the Article are copyright to their respective owner(s). Kalkine does not claim ownership of any of the pictures displayed/music used in the Article unless stated otherwise. The images/music that may be used in the Article are taken from various sources on the internet, including paid subscriptions or are believed to be in public domain. We have used reasonable efforts to accredit the source wherever it was indicated or was found to be necessary.

Kalkine Media Pty Ltd, an affiliate of Kalkine Pty Ltd, may have received, or be entitled to receive, financial consideration in connection with providing information about certain entity(s) covered on its website.