Advanced Micro Devices Inc. (AMD) shares surged 18.0% to $133.50 on Wednesday after the chipmaker reported first-quarter results that crushed Wall Street expectations on virtually every metric. Revenue of $10.3 billion topped the $10.01 billion consensus by 2.9%, while adjusted earnings per share of $1.13 beat the $1.02 estimate by 10.8%. The stock posted its largest single-day gain since November 2023.
The outperformance was driven by AMD's data center segment, which generated revenue of $5.8 billion — up 57% year-over-year and 22% sequentially. CEO Lisa Su told analysts that demand for EPYC server processors and Instinct MI350 GPUs 'significantly exceeded our prior expectations' as hyperscale cloud providers and enterprise customers accelerated AI infrastructure deployments.
AI GPU Revenue Accelerates
AMD's Instinct GPU revenue within the data center segment reached an estimated $2.8 billion in Q1, up from $2.2 billion in Q4 2025 and $1.1 billion in Q1 2025. The MI350 series — AMD's direct competitor to Nvidia's H200 and B100 chips — has secured design wins at Microsoft Azure, Oracle Cloud, and Meta's AI training clusters. Su noted that AMD now has 'line of sight to $15 billion in annualized data center GPU revenue by Q4 2026.'
Guidance Blows Past Estimates
AMD guided Q2 2026 revenue to $11.2 billion, plus or minus $300 million, well above the $10.52 billion consensus. The midpoint implies 28% year-over-year growth and 8.7% sequential acceleration. Gross margins are expected to expand to 54.5% from 53.8% in Q1 as the product mix shifts toward higher-margin data center GPUs.