AMD’s third quarter results were shaped by robust demand in its data center and AI businesses, as well as strong sales of server and PC processors. Management attributed the revenue growth to record sales of EPYC CPUs and Instinct GPUs, noting broad-based adoption across cloud, enterprise, and hyperscale customers. CEO Lisa Su highlighted that, “the combination of our expanding compute franchise and rapidly scaling data center AI business drives significant revenue and earnings growth.” However, despite these positive drivers, the market reacted negatively to the results, reflecting investor concerns raised on the call around higher inventory levels and the sustainability of recent growth trends. Management acknowledged increased operating expenses linked to aggressive R&D and go-to-market investments.
Is now the time to buy AMD? Find out in our full research report (it’s free for active Edge members).
AMD (AMD) Q3 CY2025 Highlights:
- Revenue: $9.25 billion vs analyst estimates of $8.76 billion (35.6% year-on-year growth, 5.6% beat)
- Adjusted EPS: $1.20 vs analyst estimates of $1.17 (2.4% beat)
- Adjusted EBITDA: $2.43 billion vs analyst estimates of $2.11 billion (26.3% margin, 15.4% beat)
- Revenue Guidance for Q4 CY2025 is $9.6 billion at the midpoint, above analyst estimates of $9.17 billion
- Operating Margin: 13.7%, up from 10.6% in the same quarter last year
- Inventory Days Outstanding: 158, up from 139 in the previous quarter
- Market Capitalization: $397.2 billion
While we enjoy listening to the management's commentary, our favorite part of earnings calls are the analyst questions. Those are unscripted and can often highlight topics that management teams would rather avoid or topics where the answer is complicated. Here is what has caught our attention.
Our Top 5 Analyst Questions From AMD’s Q3 Earnings Call
- Vivek Arya (Bank of America Securities) asked about the sustainability of data center growth and the transition from MI355 to MI400; CEO Lisa Su said strong customer visibility supports ongoing momentum into 2026, with new product ramps expected to drive further gains.
- Thomas O'Malley (Barclays) questioned supply constraints and power requirements for large AI deployments; Su replied that AMD is working closely with supply chain and customers to align capacity and infrastructure, but acknowledged tightness in both areas.
- Joshua Buchalter (TD Cowen) pressed on the durability of CPU demand in data center and potential supply bottlenecks; Su indicated that AI workloads are driving multi-quarter demand, while CFO Jean Hu confirmed AMD is prepared with adequate supply.
- Stacy Rasgon (Bernstein Research) sought clarification on whether servers or GPUs drove more growth; Hu said both segments performed similarly with server slightly outpacing GPU growth, and guidance implies continued strength in both areas.
- Timothy Arcuri (UBS) inquired about customer concentration risk from OpenAI and whether recent wins are expanding AMD’s market reach; Su highlighted broadening customer engagement and supply chain dimensioning to support multiple large clients.
Catalysts in Upcoming Quarters
In coming quarters, the StockStory team will be watching (1) the pace and breadth of adoption for MI350 and anticipated MI400 GPU launches, (2) management’s ability to diversify its AI customer base beyond OpenAI and Oracle, and (3) progress in reducing inventory days outstanding and managing operating expenses. Execution on the Helios rack-scale solution and new commercial wins in the enterprise and cloud sectors will also be key indicators of AMD’s strategic momentum.
AMD currently trades at $245.87, down from $250.11 just before the earnings. Is the company at an inflection point that warrants a buy or sell? See for yourself in our full research report (it’s free for active Edge members).
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