AMD Reports 38% Revenue Growth in Q1, Beats Analyst Estimates

Advanced Micro Devices reported first-quarter earnings that beat analyst estimates for both earnings per share and revenue. Revenue climbed 38% year-over-year, with the company's data center business serving as the primary driver. Lisa Su, CEO of Advanced Micro Devices, said the company's strong first-quarter earnings were largely driven by boosted demand for central processing units.

CPUs have seen a resurgence as the compute needs have shifted with the rise of agentic AI, and AMD has been a leading maker of CPUs, which are needed for inference tasks. "Agents are really driving tremendous demand in the overall AI adoption cycle, and we're very excited to be in the middle of it," Su said. She told CNBC's "Squawk on the Street" on Wednesday.

On the company's earnings call Tuesday, Su revised the server CPU market growth estimate to exceed 35% growth each year. In November, AMD had forecasted the server CPU market to grow about 18% annually over the next three to five years. Su doubled her long-term forecast, expecting the server CPU market to top $120 billion by 2030.

The demand picture became clearer over the last 90 days after talks with the company's largest customers. "The main thing that I can say is that we are seeing a shifting of the workload," Su said. CNBC reported that the revision followed the clearer demand signals from those customer discussions.

The company beat analyst estimates on Tuesday for both earnings per share and revenue in the first quarter. Su highlighted the company's data center business as the primary driver of its first-quarter revenue growth. While the company has trailed Nvidia in the market for graphics processing units, AMD has maintained its position in CPUs.