What AMD and Intel’s results reveal about who AI is leaving behind
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AMD’s data center business nearly doubled in the third quarter, as demand for AI chips pushed the company to record revenue of $13.4 billion. Its results, published Nov. 3, came less than a week after Intel warned that a weakening PC market would pull its fourth-quarter sales below Wall Street expectations.
Taken together, the 2 reports show AI demand splitting the chip industry. Chips for AI data centers are selling strongly. Chips for PCs are being squeezed, partly because AI is absorbing the memory those machines need.
The forecasts make the contrast plain. AMD expects fourth-quarter revenue of about $17 billion, plus or minus 3%. Intel, still the larger company by third-quarter revenue, expects $15 billion to $16 billion. Both are projections, but if each company lands within its range, AMD would report the higher quarterly revenue.
AMD’s data center business nearly doubled in a year
AMD’s third-quarter revenue rose 45% from a year earlier and 16% from the previous quarter. Net income reached $2.4 billion.
Data center sales did most of the work. The segment brought in a record $8.5 billion, up 97%, driven by EPYC server processors and the launch of AMD’s Instinct MI450 Series GPUs, the accelerators used to train and run AI models. That one segment now accounts for almost two-thirds of the company’s revenue.
The PC side of AMD’s business has held up better than Intel’s. Client revenue rose 7% to $2.9 billion on sales of Ryzen mobile processors, although gaming revenue fell 40%. That detail matters: the PC squeeze is not hitting every chipmaker equally.
AMD’s fourth-quarter outlook implies growth of about 66% year over year at the midpoint, as the company scales production of its Helios rack-scale AI systems.
Intel’s PC business is paying for AI’s appetite for memory
Intel’s third quarter was stronger than the market reaction suggests. Revenue rose 21% to $16.5 billion. Its Data Center and AI group grew 78% to $7.3 billion, which chief financial officer David Zinsner described as the company’s strongest data center revenue growth in 15 years.
The problem is the outlook. Intel’s client computing group, its largest business, slipped 5% to $8.1 billion in the third quarter. Reuters reported that Intel expects PC segment sales to fall more than 20% from the previous quarter in the fourth. Its $15 billion to $16 billion revenue forecast compared with analyst expectations of about $17.07 billion, according to LSEG data cited by Reuters.
“We see the PC slowdown continuing at least through the first half of next year,” Zinsner said in the company’s results release.
Memory is a large part of the reason. Reuters reported that suppliers are shifting production capacity toward high-bandwidth memory, the stacked chips that sit alongside AI processors, and that the shift is raising PC costs while consumer demand is already weak. Intel’s own release lists industry-wide memory and substrate shortages among its risks.
Investors reacted sharply. Intel’s shares lost more than a quarter of their value on Oct. 30, and the selloff spread to other chip stocks, AMD among them.
For manufacturers, the pattern will look familiar. As we reported in July, Apple has reportedly sought US approval to buy memory chips from a Chinese supplier as AI servers take a growing share of memory output. Intel’s warning shows the same pressure reaching PCs: when one end market absorbs scarce parts, another pays more for what is left.
Intel Foundry is growing faster than it is turning a profit
The other side of Intel’s results matters for US chipmaking ambitions. Intel Foundry, the business that manufactures chips for Intel and for outside customers, grew revenue 58% to $6.7 billion. Its operating loss narrowed to $1.85 billion from $2.32 billion a year earlier.
That is progress, but the unit is still losing money at scale, and its revenue includes work done for Intel’s own product groups.
The technology roadmap is moving. In October, Intel released version 0.9 of its 14A process design kit, the toolkit chip designers use to build on its upcoming 14A manufacturing process. It also announced a collaboration with ASML to prepare the industry for High-NA EUV, the next generation of lithography equipment used to print the finest chip features.
Those steps matter because a domestic foundry needs outside customers designing on its most advanced processes. A weaker PC market could make the economics harder, with lower PC chip volumes leaving less internal demand to help carry factory costs while those customers are won.
The open questions sit on both sides of the divide. AMD’s forecast depends on scaling new data center products on schedule. Intel expects PC weakness to last at least through the first half of 2027, and memory supply will shape how quickly that changes. And Intel Foundry still has to show it can turn faster growth into profit.
Source:
AMD press release
Intel press release
