AMD Hits Record Revenue as Data Center Boom Shadows Consumer Slump
AI-generated image · Bay Street Wire
The chipmaker reports its most profitable quarter ever, but AI-driven component shortages are weighing down the PC and gaming markets.
AMD reported its most profitable quarter in company history for Q3 2026, according to reporting from The Verge. CEO Lisa Su confirmed the company reached record quarterly revenue of $13.4 billion, with a projection of $17 billion for the following quarter.
The growth is almost entirely fueled by the data center sector, which generated $8.5 billion in revenue during Q3 2026. This segment accounted for roughly 63 percent of AMD's net quarterly revenue. CFO Jean Hu stated during a Tuesday earnings call that the company expects the data center business to eventually represent more than 80 percent of total revenue. Su further predicted that overall revenue will grow by more than 80 percent in 2027, with the data center remaining the primary contributor.
However, this enterprise success comes at the expense of the consumer market. The Verge reports that AMD's gaming business plummeted 40 percent compared to the previous year, falling to $773 million. This decline is linked to price hikes for PCs and game consoles caused by RAM and component shortages, which are being driven by the high demand from AI data centers.
Su noted that consumer markets are sensitive to these rising system prices, leading to a slowdown in sell-through and a projected "down year" for 2027. The supply outlook remains bleak; Intel does not expect the shortage to improve next year, and SK Hynix has predicted the shortage could persist until 2030.