AMD reported strong Q4 2025 earnings, beating estimates with $1.53 per share, a 40.4% increase year over year. Revenues of $10.27 billion also exceeded expectations, up 34.1% year over year. Data center revenues were a key driver, increasing 39.4% to $5.38 billion. AMD shares fell 7.57% post-earnings.

Client and Gaming segments saw significant growth, with revenues climbing 33.9% and 49.7% year over year, respectively. Client segment revenues reached $3.09 billion, while Gaming segment revenues hit $843 million. Despite a sequential decline in Gaming revenues, the overall contribution from these segments to total revenues increased by 37% year over year.

AMD’s Embedded segment saw a 2.9% year-over-year increase in revenues to $950 million, accounting for 9.3% of total revenues. Gross margins expanded to 57%, up 290 basis points from the previous year. Adjusted EBITDA also increased by 38.7% year over year to $3.04 billion.

Operating income from Client and Gaming segments surged year over year but declined sequentially to $725 million. Data Center operating income was $1.75 billion, a significant increase from the previous year. Embedded operating income increased sequentially, though it declined year over year. AMD also improved its balance sheet, with higher cash reserves and stable debt levels.

For the first quarter of 2026, AMD expects revenues of $9.8 billion, representing a 32% year-over-year growth but a 5% sequential decline. The company returned $1.3 billion to shareholders in Q4 2025 through share repurchases, with $9.4 billion remaining under the current authorization. Advanced Micro Devices currently holds a Zacks Rank #2 (Buy).

Investors can access Zacks’ AI Boom 2.0 report for insights on under-the-radar AI companies poised for growth. Other top-ranked stocks in the Computer and Technology sector include Arista Networks, Advanced Energy, and Amkor Technology. Arista Networks will report Q4 2025 results on Feb. 12, while Advanced Energy will report Q3 2025 results on Feb. 10. Amkor Technology is set to report Q4 2025 results on Feb. 9.

Read more at Nasdaq: AMD Q4 Earnings Beat Estimates, Revenues Up Y/Y, Shares Fall