Special Topic: Spotlight on the 2026 Third-Quarter US Stock Earnings Season. This earnings outlook may deliver a much-needed boost to the capital markets.

AI server chip maker Advanced Micro Devices (AMD) said on Tuesday that its revenue for the current quarter will grow about 66% year over year, accelerating by 21 percentage points compared with the third quarter. The company also projected that next year's revenue growth will exceed 80%, more than double the level its financial model had expected a year ago. It further anticipates that fourth-quarter gross margin will edge up 1 percentage point from the third quarter, and that revenue growth will continue to outpace the growth of operating expenses next year.

Last week, investors grew uneasy about the rising capital spending of the major cloud providers — the biggest customers of AMD and NVIDIA — making AMD's optimistic outlook all the more significant. Although third-quarter revenue growth slowed by 5 percentage points from the second quarter and free cash flow shrank by two-thirds to only about $550 million amid a more than doubling of capital spending, AMD's forecast of accelerating revenue growth overshadowed those negatives. Following the announcement, AMD shares rose more than 8% in after-hours trading.

AMD's server chip business nearly doubled its revenue in the third quarter, accounting for close to two-thirds of the company's total revenue of $13.4 billion. While NVIDIA's revenue is at least seven times that of AMD and growing faster, as of Tuesday's regular trading close, NVIDIA had gained less than 10% year to date, whereas AMD shares had surged 116%. On valuation, AMD looks more expensive: its forward 12-month price-to-earnings ratio is nearly 37 times, versus just 14 times for NVIDIA. Beyond the major cloud service providers, OpenAI, Meta and Anthropic are all existing customers or users of AMD chips, including full-rack products. AMD CEO Lisa Su gave a positive assessment of customers' capabilities: despite potential difficulties, many AMD customers are raising large amounts of financing through equity and debt to build data centers, and are capable of completing chip deployment and production by 2027.