Advanced Micro Devices, Inc.

Q1 revenue was $10.3 billion, up 38% year over year; non-GAAP gross margin was 55%, up 170 basis points; operating income was $2.5 billion, or a 25% margin; and diluted EPS was $1.37, up 43%. Free cash flow was a record $2.6 billion, cash from operations was $3.0 billion, and cash, cash equivalents and short-term investments ended at $12.3 billion. By segment, Data Center revenue was $5.8 billion, up 57%; Client and Gaming revenue was $3.6 billion, up 23%; and Embedded revenue was $873 million, up 6%. For Q2, AMD guided revenue to approximately $11.2 billion, plus or minus $300 million, implying about 46% growth at the midpoint, with non-GAAP gross margin of about 56%, operating expenses of about $3.3 billion, other income/expense of a gain of about $60 million, an effective tax rate of 13%, and diluted share count of about 1.66 billion. Management said Data Center should drive very strong Q2 growth, with server CPU revenue expected to grow more than 70% year over year.

Lisa Su framed the quarter as a clear inflection in AMD’s growth trajectory, driven by accelerating AI infrastructure demand across the portfolio. She emphasized that Data Center is now the primary growth engine, and said AI workloads are increasing demand not only for accelerators but also for CPUs used for orchestration, data movement and head-node compute. Her tone was confident and expansive, highlighting strong customer pull for Venice, Helios and MI450, and saying AMD sees a path to exceed its long-term financial targets, including more than $20 in EPS over the strategic time frame.

Jean Hu said Q1 results showed strong execution and operating leverage, with revenue of $10.3 billion, gross margin of 55%, operating income of $2.5 billion, and EPS of $1.37. She highlighted record free cash flow of $2.6 billion, inventory of roughly $8 billion, quarter-end cash and investments of $12.3 billion, and $221 million returned to shareholders via buybacks. For Q2, she guided to roughly $11.2 billion in revenue, 56% gross margin, $3.3 billion of operating expenses, and a 13% tax rate, and said margin strength should be supported by server CPU growth, stronger client mix, and Embedded, partially offset later by MI450 ramp.

Analysts focused heavily on the jump in server CPU TAM, the pace of AI-driven demand, and how AMD is thinking about share versus x86 and ARM competitors. Lisa Su said the TAM increase is largely driven by Agentic AI and inferencing, and that CPU demand is rising because customers now plan CPUs and accelerators together; she also said AMD believes it can grow to greater than 50% share of the server CPU market. Questions also probed AI GPU ramp timing, supply constraints, power and data center build-outs, memory inflation, and margins; management said customer visibility for 2027 deployments is strong, supply is tight but manageable, and the company has enough memory supply to meet and exceed targets.