Mirror Review
May 8th, 2025
The latest AMD Q1 2025 earnings have revealed a significantly stronger-than-expected start to the year. The tech giant announced financial results for the quarter ending March 29, 2025, showcasing robust year-over-year growth and handily beating Wall Street’s revenue forecast with $7.4 billion, a 36% increase compared to the previous year and slightly above the $7.13 billion LSEG expectation.
Here’s the breakdown of the key figures for the AMD Q1 Results (2025):
| Metric | Q1 2025 Figures | Description / Comparison |
| Revenue | $7.4 billion | A 36% increase from last year. This was slightly above the $7.13 billion expected by LSEG. |
| Gross Margin (GAAP) | 50% | The reported gross margin under Generally Accepted Accounting Principles. |
| Gross Margin (Non-GAAP) | 54% | This represents the adjusted gross margin, a key metric watched for operational efficiency. |
| Operating Income (GAAP) | $806 million | Reflects profitability from core operations before interest and taxes under GAAP standards. |
| Operating Income (Non-GAAP) | $1.8 billion | This is a significant figure for operational profitability on an adjusted basis. |
| Net Income (GAAP) | $709 million | A significant increase from $123 million in the same quarter of the previous year. |
| Net Income (Non-GAAP) | $1.6 billion | Representing the company’s adjusted net profit for the quarter. |
| Diluted Earnings Per Share (GAAP) | $0.44 | Up significantly from $0.07 per share in the prior year, reflecting increased profitability per share. |
| Diluted Earnings Per Share (Non-GAAP/Adjusted) | $0.96 | This beat the expected $0.94. |
Dr. Lisa Su, AMD’s Chair and CEO, commented on the results, saying, “We delivered an outstanding start to 2025 as year-over-year growth accelerated for the fourth consecutive quarter driven by strength in our core businesses and expanding data center and AI momentum.”
She also touched on the challenges faced by the company, adding, “Despite the dynamic macro and regulatory environment, our first quarter results and second quarter outlook highlight the strength of our differentiated product portfolio and consistent execution positioning us well for strong growth in 2025.”
Echoing this perspective, AMD EVP, CFO, and Treasurer Jean Hu said, “We grew first quarter revenue 36% year-over-year and delivered significant earnings leverage as our business gains scale.”
10 Key Insights from AMD’s Q1 2025 Performance
Here are the key takeaways for a deeper understanding of AMD’s current position and future trajectory.
- Data Center Dominance Continues:
The Data Center segment was a star performer, with revenue hitting $3.7 billion, up an impressive 57% year-over-year. This growth was driven by strong sales of AMD EPYC™ CPUs and AMD Instinct™ GPUs.
- AI Momentum is Strong:
AMD’s AI game is getting stronger. They’re seeing real momentum, with their Instinct GPUs gaining traction for training AI models.
Dr. Su mentioned, “The depth and breadth of our customer engagements continues to expand as breakthroughs in large-scale AI models like OpenAI’s 03 and DeepSeek R1 drive increased demand.”
- Client Segment Rebounds Strongly:
The Client segment (which includes chips for laptops and PCs) saw revenue of $2.3 billion, a 68% increase from last year. This was largely due to the huge demand for the latest “Zen 5” AMD Ryzen™ processors. The overall Client and Gaming segment revenue was $2.9 billion, up 28% year-over-year.
- Gaming Sees a Dip:
Gaming revenue fell by 30% year-over-year to $647 million. The decline was mainly due to reduced semi-custom revenue, including chips for gaming consoles.
- Mixed Performance in Embedded Segment:
The Embedded segment, mostly sales from the Xilinx acquisition, reported revenue of $823 million. This slight decrease of 3% year-over-year reflects mixed demand in end markets.
- Export Controls Affect Revenue:
AMD confessed to the impact of U.S. export controls on advanced AI chips to China. The company’s Q2 forecast includes $800 million in charges for inventory and related reserves due to these new controls.
Dr. Su stated, “While we face some headwinds from the dynamic macro and regulatory environments, including the recently announced export controls for Instinct MI308X shipments to China, we believe they are more than offset by the powerful tailwinds from our leadership product portfolio.”
Moreover, AMD is bracing for about $700 million in lost sales this current quarter alone, and potentially $1.5 billion for the whole fiscal year.
- Strong Q2 Outlook Despite Challenges:
For the second quarter of 2025, AMD anticipates revenue to be approximately $7.4 billion (plus or minus $300 million). Their Non-GAAP gross margin is forecasted at 43% (inclusive of the $800 million charge related to export controls). Excluding this charge, the non-GAAP gross margin would be around 54%. This outlook is better than what Wall Street estimates for revenue.
- Strategic Acquisitions and Partnerships:
AMD has recently completed its acquisition of ZT Systems. This move was aimed at improving its presence in the growing data center AI accelerator market. The company also stated its strong strategic alliances with notable organizations such as Core42, Dell Technologies, France’s CEA, Jio Platforms, Cisco, and Nokia.
- Expanding Product Portfolio:
AMD continues to innovate, announcing new products like
- Radeon RX 9070 XT and RX 9070 graphics cards
- Ryzen 9 9950X3D and Ryzen 9 9900X3D processors with 2nd Gen AMD 3D V-Cache™ technology
- New EPYC Embedded 9005 Series processors
They also expanded support for frontier AI models on AMD Instinct GPUs with AMD ROCm™ software.
- Commitment to Open Standards:
In its efforts to promote an open ecosystem, AMD has confirmed its support for the latest UALink 1.0 specification. UALink 1.0 is an industry-standard interconnect designed for scalable AI operations.
What’s ahead for AMD?
Looking at the AMD Q1 2025 earnings, it’s clear the company has a lot going for it, especially in the booming data center and AI fields. Yes, those export restrictions are a hurdle, no doubt about it. But AMD’s wide range of products and smart partnerships seem to be giving them a good foundation to weather these storms. As Jean Hu mentioned, they’re still investing heavily in R&D and getting their products out there, which shows they’re playing the long game. The rest of 2025 will be about how well they can juggle these challenges while still riding the AI wave. But for now, the AMD Q1 report 2025 give us a cautiously optimistic outlook.
