AMD Just Reported Its Data Center Revenue More Than Doubled Year-Over-Year. What Comes Next.

Advanced Micro Devices’ (AMD) data center business just delivered one of the clearest structural shifts in the company’s modern history. In the second quarter of 2026, AMD reported data center revenue of $6.7 billion. 

That’s more than double the $3.2 billion recorded a year earlier. The segment now accounts for 58% of total company revenue, up from roughly 42% in the year-ago period.

This is no longer a recovery narrative or a cyclical bounce. AMD management’s own language reflects the change. CEO Lisa Su called the quarter “excellent,” citing the more-than-doubling of data center revenue, while CFO Jean Hu stated that data center sales are expected to accelerate further in the second half of 2026.

The question now is straightforward. With data center demand still intensifying across the industry and AMD’s next generation of AI systems beginning to ramp, what actually comes next for this business and for the stock? 

AMD’s Data Center Engine

Advanced Micro Devices is an $845.6 billion U.S.-based semiconductor company that designs high-performance CPUs and GPUs for data centers, PCs, and gaming from its headquarters in Santa Clara, California. 

Since the start of the year, shares are up 128.5% and 199.95% over the past 12 months.  

That strong run has also made the stock expensive, with the stock trading at a forward price-to-earnings ratio of 82.67 times and a price-to-sales multiple of 24.41 times, both well above the sector’s median of 24.14 times and 3.20 times.

On August 4, AMD reported Q2 CY2026 results that highlight the centrality of the data center business to its story. AMD’s data center segment delivered $6.7 billion, up 107% year-over-year (YOY), driven by strong demand for EPYC processors and Instinct GPUs. 

Its revenue reached $11.54 billion, up 50.1% YOY and modestly above analyst expectations of $11.35 billion. This translated into adjusted EPS of $1.66 versus estimates of $1.61. 

The company’s adjusted EBITDA came in at $3.32 billion for a 28.7% margin, comfortably ahead of the $2.88 billion forecast. 

This same period saw client and gaming revenue at $3.8 billion, with client at $3.1 billion rising 23% and gaming at $779 million falling 31%, while embedded revenue reached $977 million, up 19%. Their operating margin improved to 17.3% from -1.7% a year earlier.  

AMD’s Multi‑Year Data Center Plans

AMD is lining up partnerships that could support its data center growth well beyond the latest quarter. 

First, its deal with Core Scientific (CORZ) gives AMD access to up to 2.5 gigawatts of U.S. data center capacity for Instinct GPUs, EPYC processors, and ROCm software. The rollout begins with more than 500 megawatts in 2027 and can expand over time as customer demand grows.

That added capacity should help AMD support larger deployments, including its work with Anthropic. Anthropic plans to deploy up to 2 gigawatts of MI450 GPUs in AMD Helios systems, with the first 1 gigawatt expected to begin deployment in the first half of 2027. The companies will also use Claude to improve workloads on AMD Instinct GPUs and support ROCm development. AMD has committed up to $5 billion in Anthropic, adding a financial link to the partnership.

In addition, AMD is building out its position in faster AI response systems through its work with Cerebras (CBRS). Cerebras plans to deploy AMD Helios in its data centers, with the joint offering expected through Cerebras Cloud in the second half of 2026.

These deals give AMD more data center capacity, deeper customer ties, and more demand for its chips and software. 

What Wall Street Is Pricing Into AMD’s Data Center Story

AMD has announced the date for its next earnings report as November 3, and Wall Street expects $1.63 per share for the September 2026 quarter. That would be a 68.04% increase from $0.97 in the same quarter last year. 

Several analysts remain positive on the stock. Wedbush raised its AMD price target twice in July, taking it to $600 while keeping its “Outperform” rating. The firm pointed to AMD’s growing ties with Microsoft (MSFT) and Anthropic as reasons its data center business could keep expanding.

Susquehanna analyst Christopher Rolland also remains bullish. He maintained a positive rating on AMD and lifted his price target to $500, which suggested 2.2% upside at the time.

The broader view on Wall Street is even more upbeat. Among 45 analysts surveyed, AMD has a consensus “Strong Buy” rating. Their average price target is $578.95, which points to 18.3% upside from AMD’s current share price.  

Conclusion

AMD’s data center surge looks more like the start of a longer AI infrastructure buildout than a one-quarter spike. Growing Instinct GPU demand, EPYC CPU share gains, and large commitments from Core Scientific, Anthropic, and Cerebras provide tangible support for that view. Its shares may continue to swing as expectations stay high, but the direction appears higher if AMD converts these partnerships into sustained revenue and margin growth.