AMD's revenue beat expectations but profit missed, sending its stock down after hours.

Aug 06, 2025

Advanced Micro Devices (AMD) reported quarterly profit below expectations on Tuesday, sending its stock down about 4% in after-hours trading.



Here's how the chipmaker's results for the June quarter compared with Refinitiv (LSEG) estimates: Adjusted earnings per share: 48 cents, compared to 49 cents expected; revenue: $7.69 billion, compared to $7.42 billion expected.


For the current quarter, AMD expects sales of $8.7 billion (plus or minus $300 million), above the $8.3 billion estimate.


AMD's second-quarter net income was $872 million, or 54 cents per share, up from $265 million, or 16 cents per share, a year-ago period. During the same period, Nvidia's total sales increased 32% year-over-year, from $5.84 billion last year.


AMD is the second-largest maker of AI graphics processing units (GPUs) after Nvidia, which holds the vast majority of the market. However, large AI clients like Meta and OpenAI are increasingly looking to AMD as an alternative to Nvidia's pricier chips, particularly for inference (when AI models are deployed to the public).


This quarter, AMD released a new AI chip called the MI400, which is expected to be available next year. OpenAI CEO Sam Altman has pledged to use AMD's latest GPUs.


AMD is also grappling with chip export controls—some AI chips are restricted due to US government concerns that high-performance GPUs could be used by adversaries to surpass US technological capabilities or for military purposes.


In April, the MI308 chip was banned from export, resulting in $800 million in lost revenue in the June quarter, the company said. However, AMD said in July that it expected shipments to resume after the Trump administration indicated it would grant waivers.


AMD's adjusted gross margin for the quarter was 43%. The company said that without the export control costs, its gross margin would have been 54%.


Besides GPUs, AMD's core business is manufacturing central processing units (CPUs), competing with Intel to power traditional servers.


Both businesses fall under the company's Data Center segment, which reported $3.2 billion in revenue for the quarter, a 14% year-over-year increase.


AMD's other major segment is "Client and Gaming," which includes CPUs for laptops and desktops, as well as GPUs for 3D gaming. Revenue there increased 69% year-over-year to $3.6 billion. Client revenue grew 57% to $2.5 billion, roughly in line with StreetAccount's estimate of $2.56 billion, driven in part by strong demand for the company's latest desktop CPU, the AMD Ryzen Zen 5.


AMD said gaming revenue grew 73% year-over-year to $1.1 billion, topping StreetAccount's estimate of $784 million, driven by increased demand for custom chips for gaming consoles and gaming GPUs.

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