AMD reported strong Q2 2025 revenue growth of 32% year-over-year, reaching $7.69 billion, surpassing analyst expectations of $7.42 billion. However, after-hours trading saw shares drop over 6% to $163.37 as investors hoped for even better performance. While adjusted earnings per share met forecasts at $0.48, U.S. export restrictions to China weighed heavily, forcing $800 million in write-downs and slashing gross margins from 53% to 43%.
Data Center Growth Offset by Gaming Surge
The data center segment grew 14% to $3.2 billion, driven by strong demand for EPYC server processors, but posted a $155 million operating loss due to China-related setbacks. In contrast, the client and gaming division soared 69% to $3.62 billion, fueled by record sales of Ryzen processors and GPUs. For Q3, AMD projects revenue of $8.7 billion, above estimates, with margins expected to rebound to 54%, though China uncertainties linger.
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