Advanced Micro Devices is forecasting robust expansion in its data center business, projecting 32% revenue growth for fiscal 2025 and accelerating earnings growth into 2026. The company attributes this momentum to its next-generation EPYC server CPUs and Instinct data center GPUs, which are designed to capture a larger share of the burgeoning AI infrastructure market. Management highlighted that design wins with major hyperscale customers have expanded its total addressable market by over 20% year-over-year.

In the quarter ended September 2025, AMD reported revenue of $9.25 billion, up 35.6% from the prior year, with gross margins recovering to 51.7%. The company sees continued strength in Q4, expecting approximately 25% sequential revenue growth driven by EPYC and GPU deployments at leading cloud providers. Analysts anticipate a double beat on both earnings and revenue when AMD reports full-year results, bolstered by consistent outperformance versus consensus for the past four quarters.

AMD’s recently announced chip deal with a major AI research organization underscores its growing credibility as an alternative to incumbents in the AI accelerator space. The Helios rack-scale solution, which pairs MI300 series GPUs with third-party CPUs, has secured deployments at Oracle and Meta. In addition, regulatory approval to ship MI308 accelerators into the reopened Chinese market is expected to add incremental revenue of $200 million in 2026. Piper Sandler has maintained an overweight rating, and 40 out of 51 covering analysts rate AMD as a buy, with a consensus price target implying over 15% upside.