AMD’s datacenter business faced headwinds in the second quarter of 2025, but the company remains confident in its long-term trajectory despite a turbulent geopolitical climate. The quarter was marked by a $800 million writeoff related to the MI308 GPU, which was restricted from sales to China following export controls imposed by the Trump administration in April. This writeoff pushed the Data Center division into an operating loss of $155 million, despite a 14.3% year-on-year revenue increase to $3.24 billion. Without the writeoff, the division would have posted an operating profit of $645 million—still a 13.2% decline from the prior quarter, even as revenue grew. The sequential decline of 11.8% reflects the sharp drop in demand for the MI308, which had been in high demand among Chinese customers in late 2024 and early 2025, likely anticipating the export restrictions. However, AMD’s overall financials were salvaged by a $834 million tax benefit and $104 million in income from discontinued operations—likely tied to ZT Systems—resulting in a net income of $872 million for the quarter. The company has not provided 2025 guidance for GPU sales, citing uncertainty around the MI308’s export status and the timing of the MI400 series launch. Despite the setbacks, AMD’s datacenter GPU sales are showing signs of recovery. Our analysis estimates $1.17 billion in GPU revenue for Q2, up 14.2% year on year and slightly up sequentially, driven by strong adoption of the MI350X and MI355X. We project sales of $1.9 billion in Q3 and $2.1 billion in Q4, totaling $6.3 billion for the year. If the MI308 is cleared for export, an additional $800 million in sales could be added, pushing total GPU revenue to $7.1 billion—a 41.4% increase from 2024’s $5.03 billion. The company’s future hinges on the MI400 series, set to launch in 2026 with its “Helios” rackscale architecture. CEO Lisa Su emphasized strong customer interest and early engagement with major deployments. The success of this next-gen platform will be critical to AMD’s long-term vision of building a datacenter business with “tens of billions of dollars in annual revenue.” On the CPU side, Epyc sales totaled $1.92 billion, with hyperscalers and cloud providers driving a 17.5% year-on-year gain to nearly $1.4 billion. Enterprise, government, and academic segments added $528 million, up 8.9% year on year. While these figures were down sequentially, they reflect a broader trend: intense competition from Intel, homegrown Arm-based CPUs, and shifting software ecosystems like ROCm versus CUDA-X. AMD’s ability to scale depends largely on access to HBM memory and continued software support. But with strong demand signals, a robust product roadmap, and a resilient business model, the company is well-positioned to ride the HPC wave—despite the current turbulence.