AMD announced it expects a $1.5 billion revenue hit in 2025 due to new U.S. export controls that require licenses for AI chip shipments to China.
This follows an earlier $800 million charge related to the same curbs, illustrating how trade restrictions are now a defining factor in the semiconductor industry.
While China represents about a quarter of AMD’s revenue, the firm appears to be weathering the impact, projecting continued double-digit growth in its AI data center business.
AMD CEO Lisa Su characterized the restrictions as a headwind but one that is “well contained.” Despite this pressure, AMD issued a second-quarter revenue forecast of approximately $7.4 billion, suggesting that customers may be frontloading purchases to get ahead of policy changes.
Analysts warn that the third quarter could bring a slowdown if order acceleration subsides.
AMD reported a robust 36 percent year-over-year increase in total revenue and a 57 percent rise in data center sales, driven by strong AI chip demand from major cloud providers like Microsoft and Meta.
These results contrast sharply with weaker showings from competitors such as Marvell and Super Micro, underscoring AMD’s relative strength in the AI arms race.
However, with a forecasted adjusted gross margin drop of 11 percentage points due to the tariffs, the long-term profitability outlook remains under pressure.
TelecomLead.com News Desk
