Advanced Micro Devices, Inc. (AMD) | The Buildout — AI Infrastructure

——Mkt cap — · 52-wk —–— · YTD — · delayed
Updated Aug 13, 2026Q1 FY2026 reviewed
AMD designs high-performance CPUs, GPUs, and AI accelerators that power cloud and AI data centers.
Data Center +107%
Revenue reached $6.7B; 58% of total revenue, up from 42% a year ago.
Q3 guide ~$13B
Revenue guided to ~$13.0B ± $300M, +41% YoY at midpoint.
Server TAM ~$220B
Server CPU TAM raised to ~$220B by 2030, >50% annual growth.
MI450 margin drag
Data center AI gross margin sits below corporate average during ramp.
The Buildout Takeaway
AMD is using a data-center-led product cycle to become a full-stack AI supplier, not just an accelerator challenger. The unresolved question is whether multi-gigawatt commitments convert on time given tight supply and customer data center readiness.
Analyst coverage
70 analysts·50 Buy20 Hold0 Sell
Median target$625  Range $260–$1,250 · 29 estimates
Management guidance
Revenue ~$13.0B ± $300M (+41% YoY at midpoint) · non-GAAP gross margin ~56% · non-GAAP OpEx ~$3.65B · server CPU >80% YoY in 2H 2026
Important: The Buildout is a data analytics platform. Content is generated by algorithms and AI agents using public filings, earnings transcripts, and market data. This is not personalized investment advice.
Our View

The Verdict

AMD is a fabless semiconductor company designing high-performance CPUs, GPUs, networking, and software, increasingly delivered as integrated rack-scale AI systems. In the AI buildout it sits upstream as a compute supplier to hyperscalers and frontier labs, building a full-stack alternative to the dominant accelerator ecosystem.

Market Cap—
Revenue (TTM)$37.5B
Revenue Growth+35.0%
EBITDA Margin (TTM)19.7%
Net Cash$8.5B
Earnings Beats6 of 7
P/E (TTM)—
EV/EBITDA (TTM)—

What We Like

  • Data Center was 58% of Q2 FY2026 revenue, up from 42% a year earlier, with segment revenue up 107% YoY to $6.7B.
  • Named multi-gigawatt commitments include OpenAI at 6 GW, Meta at up to 6 GW, and Anthropic at up to 2 GW.
  • Server CPU TAM was raised to ~$220B by 2030, growing >50% annually, from ~$60B in November 2025.
  • Embedded revenue rose 19% YoY to $977M with a 40% segment operating margin, its strongest growth in more than three years.
  • Q2 non-GAAP gross margin reached 56%, up 200 bps YoY, while comparable EPS grew 82% YoY.

What We’re Watching

  • Helios initial shipments begin late Q3 FY2026, with Q4 and Q1 FY2027 step-ups; the ramp is the core 2027 conversion test.
  • MI450/Helios gross margin is below corporate average, with yield improvement expected over the first few quarters.
  • Server CPU supply chain is tight and much demand was unforecasted; 2027 supply is expected to be better.
  • Gaming is guided to a significant double-digit Q3 decline; 2H gaming revenue is guided down >20% versus 1H.
Bottom Line

The thesis is strengthening: management raised revenue, TAM, and 2027 data center targets, while Helios and Venice moved into production and two new anchor customers were added. The open question is whether supply and customer data center build-out readiness can convert those raised commitments into shipped revenue on schedule.

Next upThe next test is the Q3 FY2026 report, when initial Helios shipments are expected late in the quarter. It tests the very beginning of the Helios ramp and 2H server CPU supply.
Last Quarter — Q1 FY2026

Earnings Beat

AMD reported Q2 FY2026 revenue of $11.5B, up 50% YoY and 13% QoQ, with non-GAAP gross margin of 56% and GAAP gross margin of 54%. Data Center revenue rose 107% YoY to $6.7B, becoming 58% of total revenue.

MetricQ1 FY2026Q4 FY2025Q1 FY2025YoY
Revenue$10.3B$10.3B$7.4B+37.8%
Gross margin52.8%54.3%50.2%+260bps
EBITDA$2.2B$2.5B$1.5B+44.3%
EPS$0.84$0.92$0.44+92.2%
Data Center revenue$6.7B$5.8Bn/a+107% YoY
We delivered another outstanding quarter with record revenue and profitability.— Lisa Su, 2026-08-04

Management tone: Management's tone shifted from the 'clear inflection' language of the Q1 call to a more expansionary stance on the Q2 call, with two TAM upgrades in one call and direct statements that analyst 2027 estimates were too low.

Management Guidance

For Q3 FY2026, management guided revenue to ~$13.0B ± $300M, +41% YoY at the midpoint and +13% QoQ, non-GAAP gross margin ~56%, non-GAAP OpEx ~$3.65B, non-GAAP other income gain ~$55M, 13% non-GAAP effective tax rate, and ~1.66B diluted shares. For 2H 2026, server CPU revenue is guided up >80% YoY; for FY2027, data center segment revenue is expected to more than double and server CPU revenue is guided up >70% YoY.

Business Trajectory

Trajectory

AMD's revenue stepped from $7.44B in Q1 FY2025 to $10.25B in Q1 FY2026 and $11.5B in Q2 FY2026, with Data Center driving the mix. GAAP gross margin recovered from a Q2 FY2025 dip of 39.8% to 52.8% in Q1 FY2026, and non-GAAP gross margin reached 56% in Q2 FY2026. The core tension is an accelerating data center business offset by a 31% YoY gaming decline and a planned softer client second half.

Revenue & Margin Trajectory
RevenueGross margin$0$5.0B$10.0B$1.0B$1.3B$1.1B$1.2B$1.2B$1.6B$1.5B$1.6B$1.8B$1.7B$1.4B$1.3B$1.5B$1.8B$2.1B$1.8B$1.9B$2.8B$3.2B$3.4B$3.9B$4.3B$4.8B$5.9B$6.5B$5.6B$5.6B$5.4B$5.4B$5.8B$6.2B$5.5B$5.8B$6.8B$7.7B$7.4B$7.7B$9.2B$10.3B$10.3B31%53%Q2'16Q3Q4Q1'17Q2Q3Q4Q1'18Q2Q3Q4Q1'19Q2Q3Q4Q1'20Q2Q3Q4Q1'21Q2Q3Q4Q1'22Q2Q3Q4Q1'23Q2Q3Q4Q1'24Q2Q3Q4Q1'25Q2Q3Q4Q1'26
RevenueGross margin$0$5.0B$10.0B$1.0B$1.3B$1.1B$1.2B$1.2B$1.6B$1.5B$1.6B$1.8B$1.7B$1.4B$1.3B$1.5B$1.8B$2.1B$1.8B$1.9B$2.8B$3.2B$3.4B$3.9B$4.3B$4.8B$5.9B$6.5B$5.6B$5.6B$5.4B$5.4B$5.8B$6.2B$5.5B$5.8B$6.8B$7.7B$7.4B$7.7B$9.2B$10.3B$10.3B31%53%Q2'16Q3Q4Q1'17Q2Q3Q4Q1'18Q2Q3Q4Q1'19Q2Q3Q4Q1'20Q2Q3Q4Q1'21Q2Q3Q4Q1'22Q2Q3Q4Q1'23Q2Q3Q4Q1'24Q2Q3Q4Q1'25Q2Q3Q4Q1'26
Gross margin as reported.
Share Price — 12 Months
$200$400$600$052-wk high $581Aug '25NovFeb '26MayAug '26
52-week range $151–$581.
Share Price — 12 Months
$200$400$600$052-wk high $581Aug '25NovFeb '26MayAug '26
52-week range $151–$581.
The Numbers

The Model

The model projects FY+1 revenue of $46,308M with EBITDA of $10,836M, a 23.4% margin, and FY+2 revenue of $64,700M with EBITDA of $18,116M, a 28.0% margin. The FY+1 path is anchored by the Data Center ramp and strong server CPU demand; FY+2 depends on continued Helios and next-generation platform conversion, with EBITDA margin expanding to 28.0%.

Revenue & EBITDA Projections
REVENUE$34.6B$49.3B$83.1BFY25FY+1 (E)FY+2 (E)EBITDA & MARGIN$6.7B$11.9B$22.4B27.0%FY25FY+1 (E)FY+2 (E)
REVENUE$34.6B$49.3B$83.1BFY25FY+1 (E)FY+2 (E)EBITDA & MARGIN$6.7B$11.9B$22.4B27.0%FY25FY+1 (E)FY+2 (E)
Solid bars are reported actuals; outlined bars are model projections — not company guidance.
MetricFY2025Next FY (E)Following FY (E)
Revenue$34.6B$49.3B$83.1B
YoY Growth—+42.3%+68.6%
EBITDA$6.7B$11.9B$22.4B
EBITDA Margin19.3%24.1%27.0%

Projections are the median of 5 independent model runs. The model’s revenue sits 7.7% above analyst consensus.

For Q3 FY2026, management guided revenue to ~$13.0B ± $300M, +41% YoY at the midpoint and +13% QoQ, non-GAAP gross margin ~56%, non-GAAP OpEx ~$3.65B, non-GAAP other income gain ~$55M, 13% non-GAAP effective tax rate, and ~1.66B diluted shares. For 2H 2026, server CPU revenue is guided up >80% YoY; for FY2027, data center segment revenue is expected to more than double and server CPU revenue is guided up >70% YoY.

What Could Go Right — and Wrong

What good looks like
  • Helios volume demand converts into shipments ahead of the late Q3 2026 start, with Q4 and Q1 FY2027 step-ups exceeding plan.
  • Server CPU supply arrives faster, lifting 2H 2026 growth above the >80% guide and FY2027 above >70%.
  • MI450/Helios gross margin improves faster than the first-few-quarters timeframe, reducing mix dilution.
  • ROCm adoption compounds from 3M models running out of the box and tenfold open-source contribution growth.
  • More or faster multi-gigawatt deployments beyond the four named anchors broaden the 2027 base.
What could go wrong
  • Helios/MI450 early yields or manufacturing complexity delay initial shipments beyond late Q3 or the Q4 step-up.
  • Customer data center power, cooling, or construction readiness pushes multi-gigawatt deployments into 2028.
  • Server CPU supply remains tight, capping the higher-margin revenue stream.
  • Memory and component inflation worsens, further weakening gaming and client demand.
What’s Next

Looking Ahead

The next 12 months are defined by the Helios ramp: initial shipments are expected late Q3 FY2026, with a Q4 step-up and a further Q1 FY2027 step-up. Venice cloud deployments begin later in 2026, Cerebras fast-inference availability is expected in Q4 2026, and Anthropic's first gigawatt begins in 1H 2027. The test is whether these milestones convert into the guided 2027 data center growth.

Catalysts
  • Late Q3 FY2026Helios initial shipments — Very beginning of the ramp; initial shipments on track late Q3.
  • Q4 FY2026Helios Q4 step-up — Described as much more substantial in Q4; near-term ramp test.
  • Q4 2026Cerebras fast inference — Helios plus Cerebras engine availability in Cerebras cloud.
  • Later 2026Venice cloud deployments — Leading cloud providers planning deployments later this year.
  • Q1 FY2027Helios further step-up — Additional step-up in Q1 FY2027; ramp through 2027.
  • 1H 2027Anthropic first gigawatt — First gigawatt of up to 2 GW MI450/Helios begins 1H 2027.
Numbers

Financials

Annual Summary

MetricFY2024FY2025TTMYoY
Revenue$25.8B$34.6B$37.5B+34.3%
Gross Margin49.2%49.0%50.3%17bps
EBITDA$5.1B$6.7B$31.0B+31.9%
EBITDA Margin19.7%19.3%19.7%35bps
Net Income$1.6B$4.3B$5.0B+164.2%
Free Cash Flow$2.4B$6.7B$20.1B—
Net Cash————

Key Ratios (Trailing)

Valuation
  • P/E TTM—
  • EV/EBITDA TTM—
  • EV/Revenue TTM—
  • Price/FCF TTM—
Profitability
  • Gross Margin (TTM)50.3%
  • EBITDA Margin (TTM)19.7%
  • Net Margin (TTM)13.4%
  • ROIC6.2%
  • FCF Conversion116.1%
  • SBC / Revenue4.7%
Reference

The Company

AMD is a fabless semiconductor company whose portfolio spans Instinct AI accelerators, EPYC server CPUs, Pensando DPUs and AI NICs, FPGAs, Ryzen client processors, and semi-custom gaming SoCs. Its 10-K describes a full-stack portfolio across cloud and AI infrastructure, embedded systems, AI PCs, and gaming.

It outsources wafer manufacturing to TSMC, GlobalFoundries, and others, and uses two Tongfu Microelectronics ATMP joint ventures plus SPIL and KYEC for assembly and test. Headquarters are in Santa Clara, California, with significant operations in Austin, San Jose, Shanghai, Markham, Longmont, Dublin, Singapore, and Bengaluru and Hyderabad.

Business Segments

Data Center
$6.7B in Q2 FY2026
AI accelerators, server CPUs, GPUs, DPUs, AI NICs, FPGAs and SoCs for data centers.
Growth driver: AI accelerator and server CPU demand; +107% YoY.
Client and Gaming
$3.8B combined in Q2 FY2026
Desktop and notebook CPUs, APUs, discrete GPUs, and semi-custom SoCs.
Growth driver: Client +23% YoY; gaming −31% YoY offsets.
Embedded
$977M in Q2 FY2026
Embedded CPUs, APUs, FPGAs, SOMs, and adaptive SoCs.
Growth driver: Strongest growth in more than three years; 40% operating margin.

Competitive Landscape

AMD's own filings name Intel and Nvidia in data center; Altera, Lattice, and Microsemi in FPGAs; and Broadcom, Marvell, Analog Devices, Texas Instruments, NXP, Qualcomm, and Nvidia in embedded ASSPs. The Q1 FY2026 10-Q adds the September 2025 Nvidia-Intel partnership and ARM-based architectures as additional competitive pressures. The FY2025 10-K risk factors also flag custom silicon as an additional competitive pressure. Nvidia is named in AMD's 10-K as a data center competitor, while AMD positions itself as a full-stack AI infrastructure supplier.

  • Nvidia
    Named in 10-K as a data center competitor.
  • Intel
    Named in 10-K as a data center competitor; 10-Q flags the September 2025 Nvidia-Intel partnership as a competitive and pricing risk.
  • Broadcom
    Named in 10-K as an embedded ASSP competitor; not discussed further.
  • Marvell
    Named in 10-K as an embedded ASSP competitor; not discussed further.
  • Arm
    10-Q says some competitors are pursuing alternative computing architectures such as Arm.
Competitor names and views come from AMD's FY2025 10-K and Q1 FY2026 10-Q as carried in the source material.

Supply Chain

AMD sits upstream in AI infrastructure, designing compute silicon and rack-scale systems that flow through foundries and OEM/ODM partners into hyperscaler and AI-lab data centers. HPE, Celestica, Supermicro, and Sanmina each referenced AMD in their own disclosures.

Supplier
TSMC
Wafers for HPC, FPGA, adaptive SoC, and microprocessor/GPU production, including 2nm for Venice.
Supplier
GlobalFoundries
12nm and 14nm wafers for HPC products.
Supplier
Tongfu Microelectronics
Two ATMP joint ventures for assembly, test, mark, and pack.
Supplier
SPIL
Additional assembly and test services.
Supplier
KYEC
Additional assembly and test services.
→
full-stack rack-scale AI platform
AMD
Fabless design house integrating CPUs, GPUs, Pensando networking, and ROCm software into Helios systems.
→
OpenAI
6 GW
First gigawatt powered by MI450; product purchase agreement.
Meta
Up to 6 GW
Multi-generation Instinct, including a custom MI450-based accelerator.
Anthropic
Up to 2 GW
First gigawatt beginning 1H 2027; Claude/ROCm co-engineering.
Microsoft
Helios at scale on Azure; no GW disclosed.

Analysis updated Aug 13, 2026, reviewing Q1 FY2026. Prices delayed. Built with The Buildout’s published methodology. Not investment advice. No positions held. © The Buildout 2026.

More on AMD: Earnings recap