By now, you should have had the opportunity to review a copy of our earnings press release and the accompanying slides. We delivered very strong second quarter results, with revenue exceeding the midpoint of guidance as higher EPYC and Ryzen processor sales more than offset headwinds from export controls that impacted Instinct sales. We set records for both EPYC and Ryzen CPU sales, reflecting the broad-based demand for our differentiated high-performance data center, PC, and embedded processors. Second quarter revenue increased 32% year over year to a record $7.7 billion, and we delivered over $1 billion in free cash flow.
Excluding the $800 million inventory write-down related to data center AI export controls, gross margin was 54%, marking our sixth consecutive quarter of year-over-year margin expansion led by a richer product mix. Turning to the segments, data center segment revenue increased 14% year over year to $3.2 billion. We saw robust demand across our EPYC portfolio to power cloud and enterprise workloads, and increasingly for emerging AI use cases. In particular, adoption of agentic AI is creating additional demand for general-purpose compute infrastructure, as customers quickly realize that each token generated by a GPU triggers multiple CPU-intensive tasks.
Against this backdrop, fifth-gen EPYC turn shipments ramped significantly, and we had sustained demand for our prior generation EPYC processors. In cloud, adoption expanded with the largest hyperscalers as they deployed EPYC to power more of their mission-critical infrastructure, services, and public cloud products. EPYC adoption also grew with telecom customers as providers modernize their infrastructure for next-generation networks. EPYC enterprise deployments grew significantly from the prior quarter, supported by new wins with large technology, automotive, manufacturing, financial services, and public sector customers.
| Metric | Period | Current guidance |
|---|---|---|
| Total revenue | Q3 2025 | Approximately $8.7 billion, plus or minus $300 million (~28% YoY growth, ~13% sequential growth), with no MI-308 China revenue included |
| Non-GAAP gross margin | Q3 2025 | Approximately 54%, despite the strong MI-350 ramp |
| Non-GAAP operating expenses | Q3 2025 | Approximately $2.55 billion |
| Net interest and other | Q3 2025 | A gain of approximately $10 million |
| Non-GAAP effective tax rate | Q3 2025 | 13% |
| Diluted share count | Q3 2025 | Approximately 1.63 billion shares |
| Instinct revenue | Q3 2025 | Expected to grow year over year, driven by the MI-350 ramp at multiple customers (no MI-308 China revenue assumed) |
| Metric | YoY | Note |
|---|---|---|
| Total revenue | +32% ($7.7B) | Record EPYC and Ryzen processor sales and higher semi-custom shipments more than offset the export-control impact on MI-308 China sales |
| Data Center | +14% ($3.2B) | Strong EPYC CPU revenue and cloud/enterprise share gains, partially offset by a year-over-year decline in AI GPU revenue from MI-308 export restrictions |
| Client | +67% ($2.5B) | Record desktop CPU sales, strong Ryzen 9000 / X3D demand, and richer product mix |
| Gaming | +73% ($1.1B) | Strong demand for newly launched Radeon GPUs and higher semi-custom console revenue as inventory normalized ahead of the holiday season |
| Client and gaming (combined) | +69% ($3.6B) | Record client CPU sales and strong PC and console gaming product demand |
| Embedded | -4% ($824M) | Embedded end-market demand remained mixed; flat sequentially |
| Topic | Previous mention | Current period | Trend |
|---|---|---|---|
| MI-350/MI-355 Instinct ramp | MI-300/MI-325 ramp with smaller initial deployments | Volume production began ahead of schedule in June with a steep second-half ramp; MI-350 matches or exceeds B200 in key training/inference workloads and delivers up to 40% more tokens per dollar, with adoption faster than expected | — |
| MI-400 series and Helios rack | — | Development progressing toward a 2026 launch; up to 40 petaflops FP4 and 50% more memory/bandwidth/scale-out than competition, with Helios racks connecting up to 72 GPUs for up to a 10x generational performance increase and significant customer interest | — |
| China / MI-308 export controls | MI-308 sales being restricted to China | Commerce Department is reviewing license applications; company expects to resume MI-308 shipments as licenses are approved but includes no MI-308 revenue in Q3 guidance; most inventory was work-in-process, so ramp will take a couple of quarters | — |
| ZT Systems | Announced intent to acquire ZT Systems | Acquisition closed early in Q2 and the team integrated seamlessly; agreed to sell ZT's U.S. manufacturing business to Sanmina for $3 billion in cash and stock (including contingent payment), expected to close near the end of 2025 | — |
| Sovereign AI | — | Announced a multi-billion-dollar collaboration (Saudi Arabia / HUMAIN starting with MI-355) and has more than 40 active global engagements; viewed as additive to the hyperscaler/AI-company opportunity, with contribution expected later than initial hyperscaler ramps | — |
| EPYC server CPU momentum | — | 33rd consecutive quarter of year-over-year share gains; more than 100 new cloud instances launched (nearly 1,200 total globally), 28 new enterprise platforms, and AMD now powers more than one-third of the world's fastest supercomputers | — |
| ROCm software | — | Launched ROCm 7 with more than 3x higher inference and training performance, nightly builds, a first developer cloud, day-zero support for Llama 4, Gemma 3 and DeepSeek R1, and ROCm Enterprise AI | — |