Advanced Micro Devices (NASDAQ:AMD) delivered a robust Q4 performance, exceeding both revenue and earnings expectations. The Data Center segment was the primary driver of this strength, growing 39% year-over-year to a record $5.4 billion as the MI350 chip ramp accelerated and EPYC CPUs gained further enterprise market share. While Client and Gaming segments combined for a 37% year-over-year increase, the gaming side alone showed signs of a seasonal slowdown. Embedded revenue finally turned a corner, posting modest growth after a year of inventory corrections.
Gross margins improved significantly to 57%, benefiting from a favorable product mix and a $360 million recovery of the inventory charges previously taken on MI308 chips. Whether these China sales can be relied upon as a recurring source of revenue remains to be seen. Operating expenses jumped 42% year-over-year and are expected to continue climbing as the company prioritizes heavy investment in R&D and go-to-market activities for AI.
For more details, key highlights, and commentary, check out the high-level earnings summary.
