AMD shares rose more than 6% in extended trading following the announcement. The stock has more than doubled so far this year as investors bet on the company's growing presence in the rapidly expanding AI infrastructure market, Reuters reported.
The chipmaker expects fourth-quarter revenue of approximately $17 billion, plus or minus 3%, compared with analysts' average estimate of $16.23 billion, according to data compiled by LSEG. However, AMD expects its adjusted gross margin to be around 55%, slightly below analysts' expectations of 55.27% and down from 56% in the third quarter.
The outlook reflects growing demand for processors used to train and run AI models. As AI workloads increasingly shift towards running models in real-world applications, demand for graphics processing units (GPUs) and central processing units (CPUs) has strengthened, supporting AMD's expansion in the data-centre market.
According to Reuters, AMD is benefiting from this shift in AI workloads and is gaining market share from rival Intel. Intel last week issued a weaker-than-expected quarterly revenue forecast, triggering a global selloff in semiconductor stocks.
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