Advanced Micro Devices (AMD) reported third-quarter profit that fell short of expectations and sent shares tumbling after the closing bell on Tuesday.

The chipmaker's third-quarter revenue rose 18% year-over-year to $6.82 billion, above Visible Alpha's analyst consensus. Net income of $771 million, or 47 cents per share, was above last year's figure of $299 million, or 18 cents per share, but below Street estimates as costs rose.

AMD's outlook is disappointing despite record data center revenue

AMD's revenue gains came as data center revenue more than doubled to a new high of $3.5 billion, driven by demand for the company's artificial intelligence (AI) chips.

The results come after AMD unveiled its next generation of AI chips at its Advancing AI event earlier this month, but did not raise its AI revenue outlook or announce new customers as many investors had hoped, weighing on its stock price.

AMD said Tuesday that it expects fourth-quarter revenue to be between $7.2 billion and $7.8 billion, up from $6.2 billion in the same quarter last year. According to Visible Alpha, the analyst consensus was at the high end of that range at $7.6 billion.

Shares of AMD fell over 7% in extended trading on Tuesday following the release.