Advanced Micro Devices delivered record revenue, doubled its data-center business, and raised its near-term sales trajectory, but one customer decision exposed the higher standard investors are applying to its AI challenge against Nvidia.
AMD shares fell 8.8% to about $473 in Wednesday premarket trading, a decline that was set to erase more than $74 billion in market value. The drop followed AMD’s quarterly report and SpaceX CEO Elon Musk’s declaration that the rocket and satellite company would build its computing infrastructure exclusively around Nvidia.
Parallel, Nvidia shares gained 1.9% before the opening bell, according to Reuters.
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Musk told investors that Nvidia’s Vera Rubin system was the “best AI computer” available and added, “So we’re exclusive to Nvidia,” according to MarketWatch. SpaceX also said it would work with Nvidia on computing payloads for planned Starlink AI1 satellites, which the company intends to operate as orbital data centers.
AMD reported Q2 revenue of $11.54 billion, up 50% from $7.69 billion a year earlier and 13% from $10.25 billion in the first quarter. The result exceeded the $11.30 billion analyst consensus cited by FactSet.
On a non-GAAP basis, operating income climbed to $3.09 billion from $897.0 million a year earlier and $2.54 billion in the first quarter. Adjusted net income rose to $2.76 billion from $781.0 million and $2.27 billion, while adjusted earnings reached $1.66 per share, above the $1.62 FactSet estimate.
Data-center revenue rose 107% year over year and 16% sequentially to $6.72 billion, accounting for 58% of AMD’s total sales. Demand for EPYC server processors and Instinct accelerators drove the increase.
AMD has secured planned deployments with customers including Anthropic, Microsoft, Meta, OpenAI, and Oracle. Its Anthropic partnership covers potential deployment of up to two gigawatts of MI450-series processors through AMD’s Helios rack-scale systems.
The firm forecast Q3 revenue of approximately $13.00 billion, plus or minus $300.0 million. The midpoint represents growth of about 41% year over year and 13% from the second quarter. The revenue outlook exceeded the $12.52 billion analyst consensus reported by LSEG.
CEO Lisa Su also said AMD expects data-center revenue to more than double in 2027 and projected companywide growth above its previous target of more than 35%.
The guidance nevertheless arrived after AMD shares had more than doubled during 2026 on expectations that its new accelerators, Helios systems, and customer agreements would take meaningful market share from Nvidia.
