AMD Server Revenue Doubles, Total Soars 50% in Q2

AMD's second-quarter results showed a dramatic acceleration in its server business, with revenue jumping 107% year-over-year to $6.7 billion, now comprising 58% of total revenue. This growth was fueled by strong demand for both Instinct GPU accelerators and EPYC server CPUs. CFO Jean Hu highlighted that server revenue continued to set records for the fifth consecutive quarter, with cloud and enterprise segments each growing over 70%. The company's client segment revenue grew 23% to $3.1 billion, driven by Ryzen processors, while gaming revenue fell 31% due to lower semi-custom console chip sales. On a GAAP basis, operating profit surged 1585% to $1.99 billion, and net income rose 163% to $2.3 billion, with earnings per share of $1.38 beating analyst estimates. Despite the positive results, AMD shares fell 8.82% after-hours as some analysts expected stronger guidance; the company projected current-quarter revenue of $13 billion, above the consensus of $12.52 billion. CEO Lisa Su raised the 2028 semiconductor market forecast to $2 trillion, with $1.4 trillion from AI GPU accelerators, and expects server revenue to more than double by 2027, with server CPU revenue growing over 70% next year. Capital expenditures increased to $808 million from $282 million a year ago. Su also noted that the PC market is expected to weaken in the second half of the year due to rising memory and component costs.