AMD reported its third-quarter results on November 3, 2026, posting record revenue of $13.4 billion as Data Center sales rose 97%.
The results for the quarter ended September 26, 2026, showed revenue growth of 45% from $9.2 billion a year earlier. GAAP gross margin widened to 54% from 52%, while operating income rose 123% to $2.8 billion and operating margin reached 21%, up from 14%.
Operating expenses increased 25% to $4.4 billion, considerably slower than revenue, allowing more of the additional sales to reach operating profit. GAAP net income rose 95% to $2.4 billion, and diluted earnings per share increased 95% to $1.46 from $0.75. AMD’s non-GAAP diluted earnings per share, a company-defined measure excluding items including stock-based compensation and acquisition-related intangible amortization, rose 74% to $2.09.
Data Center and Segment Performance
Data Center revenue reached $8.5 billion, up from $4.3 billion a year earlier. AMD attributed the increase to strong demand for EPYC processors and the launch of Instinct MI450 Series GPUs. The segment’s operating income rose to $2.9 billion from $1.1 billion, connecting the company’s profit expansion to the same AI and server hardware business that drove revenue.
Growth was uneven elsewhere. Client and Gaming revenue declined 8% to $3.7 billion: Client revenue increased 7% to $2.95 billion on sales of Ryzen mobile processors, but Gaming revenue fell 40% to $773 million because of lower semi-custom and graphics revenue. Embedded revenue grew 29% to $1.1 billion, led by growth in aerospace and defense, automotive, communications and industrial end markets.
Cash Flow Trails Earnings
The stronger income statement did not produce stronger quarterly cash flow. Net cash provided by operating activities of continuing operations fell to $1.2 billion from $1.8 billion a year earlier. Free cash flow, which AMD defines as that operating cash flow less capital expenditures, declined to $554 million from $1.53 billion.
Inventory changes were a major use of cash, consuming $3.0 billion during the quarter compared with $636 million a year earlier. Purchases of property and equipment also rose to $648 million from $258 million, further reducing free cash flow after operating cash is calculated.
Fourth-Quarter Outlook
For the fourth quarter, AMD projected revenue of approximately $17 billion, plus or minus 3%. At the midpoint, that represents approximately 66% year-over-year growth and a 27% sequential increase, with non-GAAP gross margin expected at approximately 55%.
Chair and CEO Lisa Su tied the expected acceleration to the production ramp: “Demand for our Instinct and EPYC products continued to strengthen, and we expect growth to accelerate further in the fourth quarter as we scale Helios and ‘Venice’ production.”
The quarter sets a clear operational test for AMD: Data Center is supplying rapid revenue and profit growth, but inventory and capital spending are weighing on cash conversion. Whether cash generation catches up with earnings as Helios and Venice production scales is the central question carried into the fourth quarter.
