AMD Guides Data Center AI Revenue to More Than Double in 2027

AMD expects Data Center AI revenue to grow significantly more than double in 2027, CEO Lisa Su said on the company's third-quarter earnings call, alongside record quarterly revenue of $13.4 billion.

Server revenue is set to double year over year in 2027, Su told analysts, with Data Center AI revenue growing faster than the company projected 90 days ago. Customer deployment plans have expanded since AMD last updated its outlook, she said, giving management greater visibility into next year. By 2027, AMD expects the Data Center segment to account for more than 80% of total company revenue.

The Q3 numbers anchor the forecast.

• Total revenue: $13.4 billion, up 45% year over year — a record.
• Data Center revenue: $8.5 billion, up 97%, roughly 64% of total revenue versus 47% a year earlier.
• Segment operating income: $2.9 billion, up 168%.
• Earnings per share: $2.09, up 74%.
• Gross margin: 56%, versus 54% a year earlier.

Wall Street had expected earnings of $1.89 per share on revenue of $13.1 billion, according to Benzinga Pro data. AMD beat both figures.

What changes in Q4?

AMD expects Data Center AI revenue to surpass its server CPU business in the fourth quarter, a milestone tied to accelerating deployments of the MI450 GPU and Helios rack-scale systems. For Q4 overall, the company guides to revenue of approximately $17 billion, plus or minus 3% — a midpoint implying roughly 66% year-over-year growth and 27% sequential growth. Non-GAAP gross margin is expected near 55%.

Demand currently exceeds what AMD can ship. "It is true that demand is higher than supply," Su said, adding that the company is working with supply chain partners to expand capacity.

Why does Wedbush back a $600 target?

Wedbush analyst Matt Bryson maintained an 'Outperform' rating and a $600 price target on AMD, arguing the broader data center buildout shows no cracks. Speaking on CNBC after AMD's report, he cited confirmations from multiple companies.

"We've heard from companies last week, we heard from Supermicro today, AMD as well. That data center spend is really strong," Bryson said. "From a component supply chain perspective, I'm just not seeing any weakness."

He pointed to AMD's stronger revenue outlook, expected growth of 80% next year, and plans for EPYC server CPU sales to double as evidence of broad-based demand. On valuation, Bryson said a 30-times earnings multiple is comfortable for a company growing at 80% — and he goes further.

"I pushed AMD up to 40 times," Bryson said, while cautioning that multiples above that level become harder to defend.

His summary of the demand environment was three words: "Everyone needs compute."

How did the stock react?

AMD shares rose 7.33% to $519.39 in overnight trading at the time of writing, after closing 3.65% higher at $483.90 in Tuesday's regular session.

The trajectory is straightforward: Data Center AI passes server CPUs in Q4, more than doubles in 2027, and carries more than 80% of AMD's revenue.