AMD just told Wall Street 2027 will grow more than 80% — and the stock jumped

Advanced Micro Devices delivered the earnings report the AI trade needed — and then raised the bar far higher. After markets closed on Tuesday, November 3, AMD reported record third-quarter revenue of $13.38 billion, up 45% from a year earlier and above the roughly $13.09 billion analysts expected. Adjusted earnings came to $2.09 a share, beating expectations of about $1.94 to $1.95. The stock rose 5% to 7% in pre-market trading on Wednesday.

The engine was the data centre. Revenue from data-centre chips reached a record $8.55 billion, up 97% year over year, and now makes up 64% of AMD's total sales, up from 47% a year ago. Chief executive Lisa Su said the company delivered a record quarter with revenue above the high end of its guidance as data-centre sales nearly doubled, driven by demand for its EPYC server processors and the launch of its Instinct MI450 AI chips. Growth slowed slightly from 107% in the second quarter, but the scale is now far larger.

The fourth-quarter forecast beat expectations too. AMD guided to revenue of about $17 billion, plus or minus 3%, against analyst expectations of about $16.2 billion — implying roughly 66% annual growth and a 27% jump from the third quarter. Finance chief Hu Jin added that data-centre revenue should grow about 50% from the third quarter, with data-centre AI revenue surpassing server CPU revenue for the first time in the fourth quarter.

Then came the number that moved the stock: 2027. Su told analysts AMD now expects overall revenue to grow more than 80% in 2027, more than double the long-term model of above 35% outlined at its analyst day last November. Server revenue should roughly double, data-centre AI revenue should significantly more than double, and data-centre products should make up more than 80% of total sales. One analyst estimate cited in coverage put that above $94 billion of revenue, against Wall Street's previous expectation of about $89.9 billion.

There are soft spots, and AMD did not hide them. The company expects an adjusted gross margin of about 55% in the fourth quarter, down from 56% in the third and slightly below the 55.3% average estimate. It is planning for PC shipments across the industry to fall by a double-digit percentage in 2027, and client and gaming revenue is expected to fall more than 20% in the fourth quarter. Su pushed back on supply worries, saying demand exceeds supply but the company has planned capacity for years with customers and suppliers across wafers, substrates, advanced packaging and memory.

Why it matters beyond one stock: AMD's report is the first big test of whether AI infrastructure spending is still accelerating after a month in which investors grew wary of Big Tech's soaring AI spending. Super Micro also surged after hours on its own results, and Nvidia — the market's biggest AI bellwether — reports on November 17. Treat the 80%-plus 2027 target as a target, not a fact: it depends on product ramps, supply and customer budgets all holding.

What to watch: whether AMD holds its pre-market gains through Wednesday's session; Nvidia's November 17 earnings; and any sign of supply constraints in memory or advanced packaging.