AMD posts record $13.4 billion revenue as AI boom fuels explosive growth, but gaming sales plunge 40%

AMD announced record $13.4 billion in revenue for the third quarter of 2026, up 97% year-over-year. The surge in revenue is largely attributed to the booming AI industry, with AMD's Instinct accelerators and Epyc server processors driving growth. However, the gaming segment experienced a 40% decline in sales, falling to $773 million.

The data center segment, which includes AMD's Instinct accelerators and Epyc server processors, contributed $8.5 billion of the total revenue, making up about 63% of the company's net revenue. AMD anticipates another record-breaking quarter with roughly $17 billion in revenue.

Despite the gaming segment's decline, AMD CEO Lisa Su emphasized that the company's performance is the best in its history, and expects revenue to grow more than 80% in 2027, with data center business expected to be the largest contributor. CFO Jean Hu further stated that the company believes its data center business will make up more than 80% of the total company revenue by 2027.

AMD's Client and Gaming segment brought in $3.7 billion, down 8% from a year earlier. The growth in this segment was mainly driven by strong sales of Ryzen mobile processors for laptops and mini PCs. However, higher memory and component costs impacted desktop processors and graphics cards. The gaming decline was mainly due to lower semi-custom and graphics revenue, with AMD's semi-custom chips found in Sony's PlayStation 5 and Microsoft's Xbox Series X|S, and mobile systems-on-chips in handheld PCs.

AMD is not expecting the current conditions to improve soon, with the company planning for a down year in the 2027 PC market. The company is counting on its Ryzen roadmap, which includes consumer Zen 6 processors due next year, and a larger presence among commercial PC buyers to offset the shrinking market. AMD's Radeon AI PRO Series, aimed at workstations and AI workloads, is also growing strongly.