AMD · Earnings call · 2026Q3T · Full report

Gross Margin Drivers

ADVANCED MICRO DEVICES INC · 2026-11-03 · Importance 59 · Surprise 32

Third-quarter gross margin was 56%, up 190 basis points year over year, reflecting a richer product mix. AMD guided to fourth-quarter non-GAAP gross margin of approximately 55%. Management said Data Center AI revenue is growing rapidly but is somewhat dilutive to the corporate average gross margin, while increasing gross-margin dollars; Embedded growth is expected to support margins in 2027.

Key facts

• AMD Q3 2026 gross margin was 56%, up 190 basis points year-over-year, reflecting richer product mix.
• AMD said its 2027 gross margin would vary by quarter according to the mix of data center AI and server businesses, and it lacked visibility to provide quarter-over-quarter guidance.
• AMD said its Q4 2026 data center AI business would be much higher than its CPU business, providing a benchmark for the 2027 mix.