Advanced Micro Devices Inc Q3 2025 Earnings Call Transcript

The following is excerpted from the question-and-answer section of the transcript.

Question: Vivek Arya - Bofa Merrill Lynch Asset Holdings Inc - Analyst : Thank you for the question. I had a near-term and medium-term question. For the near term, please, I was hoping if you could give us some sense of the CPU-GPU mix in Q3 and Q4. And just tactically, how are you managing this transition from your MI355 towards MI400 in the second half of next year? Can you continue to grow in the first half of next year from these Q4 levels? Or should we expect some kind of pause or digestion before customers get on board the MI400 series?

Question: Vivek Arya - Bofa Merrill Lynch Asset Holdings Inc - Analyst : And for my follow-up, there is some industry debate, Lisa, about OpenAI's ability to kind of simultaneously engage with all three merchant and the ASIC suppliers, just given the constraints around power and CapEx and their existing kind of PSC partners and so forth. So how are you thinking about that? Like what is your level of visibility in the initial engagement? And then more importantly, how it kind of broadens out into '27, is there a way that one can model what the allocation would be? Or just how should we think about the level of visibility in this very important customer?

Question: Thomas O'Malley - Barclays Services Corp - Analyst : Good morning, taking my question and congrats on the good results. I had a first question on Helios. Obviously, with the announcement at OCP, customer interaction has to be growing. Could you talk about into next year, what your view is on discrete sales versus system sales? When do you see that crossover kind of happening? And just what initial responses have been from customers after getting a better look at it at the shelf?

Question: Thomas O'Malley - Barclays Services Corp - Analyst : Super helpful. And then as my follow-up, it's a broader question as well and similar to kind of what Vivek asked. But -- if you look at the power requirements that are out there for some of the early announcements into next year, they're pretty substantial. And then you also have component issues that you're seeing across interconnected memory, just from your perspective as an industry leader, where do you think that the constraint will be? Will it come first with components not being available? Or do you think that both data center footprint in terms of infrastructure and/or power is the gating factor to some of these deployments into next year just as we really see some larger numbers starts to get deployed.

Question: Joshua Buchalter - Cowen and Company LLC - Analyst : Hey guys, thank you for taking my question. Actually I wanted to start on the CPU side. So you and your largest competitor in that space have talked about near-term strength supporting AI workloads on general purpose servers from agentic, maybe you could speak to the sustainability of these trends. And they called out supply constraints. Are you seeing any of those in your supply chain? And like are we in a period where we should think about the CPU business on the data center side as being a seasonal? Or should we expect normal seasonality in the first half of next year?

Question: Joshua Buchalter - Cowen and Company LLC - Analyst : Got it. And for my follow-up, Lisa, in your prepared remarks, you highlighted progress you guys have made on ROCm 7. I know this has been an area of focus. And can you maybe spend a minute or two talking about where you feel you're at competitively with ROCm? How wide is the breadth of support you're able to offer to the developer community? And what areas do you still have work to do to close any potential competitive gap?

Question: CJ Muse - Cantor Fitzgerald - Analyst : Yeah, good afternoon. Thank you for taking the question. I guess first question, as you think about the 355 to 400 transition and moving to full rack scale, is there a framework that we should be thinking about for gross margins throughout calendar '26?

Question: CJ Muse - Cantor Fitzgerald - Analyst : Very helpful. And I guess maybe, Lisa, to kind of probe kind of your growth expectations through '26 and beyond. And you talked about tens of billions of dollars in '27. Can you kind of speak at a high level how you're thinking about OpenAI and other large customers? And how we should be thinking about the breadth of your customer kind of penetration throughout calendar '26, '27. Any help on that would be super.

Question: Stacy Rasgon - Bernstein Research - Analyst : Hi guys, thanks for taking my questions. My first one is for data center in the quarter, what grew more year over year on a dollar to percentage basis? The servers or the GPUs --

Question: Stacy Rasgon - Bernstein Research - Analyst : Yes. But could you -- I mean, just directionally, did one -- which one grew more than the other? I'm not even asking for numbers just directionally.

Question: Stacy Rasgon - Bernstein Research - Analyst : Okay. And then on the guidance, you said that servers -- I mean, data center overall up double digits. You said server is up strong double digits. What does that mean? Is that like more than 20%? Or like how do I -- how do I think about what you mean by strong double digits? Because again, I'm trying to -- like I mean, for the GPUs for the year, like do you think you're -- I mean, you were saying roughly like $6.5 billion or something last quarter for the year. Do you think it's still in that range? It kind of feels like you're still there.

Question: Stacy Rasgon - Bernstein Research - Analyst : Okay. So I mean if you say servers are up strongly, does that mean they're up more than the Instinct because you didn't really make that commentary on Instinct.

Question: Stacy Rasgon - Bernstein Research - Analyst : So we have to, I don't think what you just mentioned what the, what we guided. 00, okay. So I mean if you say servers are up strongly, does that mean they're up more than the instinct because you didn't really make that commentary on instinct.

Question: Timothy Arcuri - UBS AG - Analyst : Thanks a lot. Lisa, I know it's only been a month since you announced this idea with OpenAI, but can you give us maybe some anecdotes of how this has influenced your position in the market with other customers? Like are you engaged with customers that you wouldn't have been engaged with if you hadn't done this deal? That's the first part of the question. And then the second part relates to a prior question, which is that it looks like they could be something like half of your data center GPU revenue in the 2027, 2028 timeframe. So how much risk in your mind is there around that single customer for you?

Question: Aaron Rakers - Wells Fargo Securities LLC - Analyst : Yeah, thanks, for taking the questions. I'm curious on the server strength that you're seeing if there's a way to unpack how we think about unit growth versus ASP expansion as we move through the turn product cycle? And how do you guys just kind of think about that going forward?

Question: Aaron Rakers - Wells Fargo Securities LLC - Analyst : Yeah, thanks. As a quick follow-up, I'm curious not to feel maybe the discussion from next week. But Lisa, you've been very consistent, like $500 billion of total AI silicon TAM opportunity and obviously progressing above that. I'm curious as we think about these large megawatt kind of deployments, how you think about the updated views on that AI silicon TAM as we look forward?

Question: Antoine Chkaiban - New Street Research LLP - Analyst : Thank you so much for taking my question. So I'd like to ask about whether the developing relationship with OpenAI could be a tailwind to the development of your software stack. Can you maybe tell us about how the collaboration works in practice and whether the partnership contributed in making ROCm more robust?

Question: Antoine Chkaiban - New Street Research LLP - Analyst : Maybe as a quick follow-up. Could you tell us about the useful lives of GPUs? I know that most CSPs depreciate them over 5, 6 years. But in your conversations with them, I'm just wondering if you see or hear any early indication that in practice, they may be planning to sweat those GPUs for longer than that?

Question: Joseph Moore - Morgan Stanley & Co Ltd - Analyst : Great. Thank you. You mentioned MI308. I guess what's your posture there to the extent that if there is some relief that you're able to ship, do you have readiness to do that? Can you give us a sense for how much of a swing factor that could be?

Question: Joseph Moore - Morgan Stanley & Co Ltd - Analyst : Okay. But you do have product to support that market if it does open up? Or are you going to have to start to kind of rebuild inventory for that?

Question: Joseph Moore - Morgan Stanley & Co Ltd - Analyst : Okay, thank you very much. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. NOVEMBER 04, 2025 / 10:00PM, AMD.OQ - Q3 2025 Advanced Micro Devices Inc Earnings Call

Question: Ross Seymour - Deutsche Bank - Analyst : Thanks for squeezing me in. Lisa, this might take longer than the amount of time you have left before the top of the hour, but there's been so many of these multi-gigawatt announcements from OpenAI how does AMD truly differentiate in there? When you see that big customer signing deals with other GPU vendors and ASIC vendors, et cetera, how do you attack that market differently than those competitors to not only get the 6 gigawatt initially, but hopefully more after that.

Question: Ross Seymour - Deutsche Bank - Analyst : Great. And I guess as my follow-up, it will be a direct follow-on to that. You did a unique structure by granting some warrants with this deal. And I know they're -- they best according to a price that would be very accretive and make everybody happy. Do you think that was a relatively unique agreement? Or given that the world needs more processing power that AMD is open to somewhat similar, conceptually similar creative ways to address that demand over time with other equity vehicles, et cetera.