Latest news with #InstinctGPUs
Yahoo
16 hours ago
- Business
- Yahoo
Advanced Micro Devices Stock (AMD) Poised for Breakout as AI Demand Accelerates
Advanced Micro Devices (AMD) has faced its share of volatility, with the stock down 23% over the past year. However, recent momentum suggests a potential turnaround is underway. Multiple growth catalysts are driving revenue higher, and it appears the market has yet to fully recognize this acceleration. Given these tailwinds, I'm bullish on AMD and believe the stock is well-positioned for a breakout toward its all-time highs around $200 per share. Easily unpack a company's performance with TipRanks' new KPI Data for smart investment decisions Receive undervalued, market resilient stocks right to your inbox with TipRanks' Smart Value Newsletter AMD's Data Center segment is emerging as the company's growth engine—and for good reason. In Q1, the segment generated $3.7 billion in revenue, marking a 57% year-over-year increase, fueled by surging demand for its EPYC CPUs and Instinct GPUs. CEO Lisa Su pointed to deepening partnerships with major players like Microsoft (MSFT), Meta (META), and Oracle (ORCL), as hyperscalers increasingly rely on AMD's chips to power AI workloads. This momentum isn't just a one-off. Data center revenue nearly doubled in 2024 to $12.6 billion, and Q1's results continue that trajectory. AMD is further reinforcing its position through strategic acquisitions, such as Untether AI and Brium, thereby expanding its capabilities in both AI hardware and software. The upcoming Instinct MI350 series is already generating buzz for its potential to rival Nvidia in AI infrastructure. Despite the cyclical nature of the semiconductor industry, AMD's consistent data center growth, driven by rising AI demand and a strengthened ecosystem, suggests the company is well-positioned for a robust and sustained run. AMD's Client segment shouldn't be overlooked—it's staging an impressive comeback. In Q1, client revenue surged to $2.3 billion, up 68% year-over-year, driven by strong adoption of the new 'Zen 5' Ryzen processors across both laptops and desktops. AMD's Ryzen AI Max chips are at the forefront of this growth, powering over 50 AI-enabled laptop models expected to hit the market this year. But beyond the spike in sales, this signals AMD's growing presence in the PC space, particularly in AI-driven devices like Microsoft's Copilot+ PCs—a trend that could create lasting tailwinds. What's particularly compelling is the shift in market perception. Once seen as the underdog, AMD is now steadily gaining ground on Intel by delivering processors that excel in both performance and power efficiency. The Client segment's 68% jump in Q1 reflects this evolution—AMD is no longer catching up; it's setting the pace. As AI becomes increasingly integrated into everyday computing, Ryzen chips are well-positioned to keep driving growth in this segment. AMD's strategic initiatives have played a key role in fueling its recent momentum. Notably, the acquisition of ZT Systems' data center infrastructure business underscores the company's long-term ambition to lead in AI hardware. CEO Lisa Su has projected that the AI accelerator market could reach $500 billion by 2028, and AMD is positioning itself to capture a significant share. The MI235X chip, purpose-built for AI inference, targets a segment Su believes will eventually outpace AI training in market size. Collaborations are also strengthening AMD's ecosystem. From IBM (IBM) deploying Instinct MI300X accelerators to Fujitsu (FJTSF) working with AMD on sustainable AI infrastructure, these alliances are embedding AMD's technology into the fabric of global AI development. With double-digit revenue growth forecasted for the years ahead, AMD's strategic investments are increasingly looking like long-term value drivers. At first glance, AMD's current valuation—trading at 31x this year's consensus EPS of roughly $4—may seem steep. However, a closer look reveals a compelling growth story. Analysts project a 44% jump in EPS by 2026, reaching an estimated $5.71. That would bring the forward P/E down to a much more attractive 22x, a reasonable price for a company set to benefit from a robust, multi-year AI tailwind. Adding to the bullish case, AMD's gross margin climbed to 54% in Q1 and continues to improve as its high-margin data center segment scales. This margin expansion sets the stage for stronger profitability ahead, reinforcing the stock's long-term value. Wall Street maintains a fairly bullish view of AMD stock. AMD features a Moderate Buy consensus rating based on 22 Buy and 10 Hold ratings issued over the past three months. Notably, not a single analyst is bearish on AMD stock. AMD's average price target of $127.93 implies a modest 5% upside potential over the next 12 months, which, in my view, suggests that Wall Street is still underestimating the stock. AMD appears to be at a pivotal inflection point. Its Data Center and Client segments are gaining momentum, recent acquisitions are reinforcing its position in the AI space, and the current valuation suggests the market has yet to fully price in its growth potential. While challenges like export restrictions to China and weakness in the gaming segment remain, they're far outweighed by AMD's aggressive expansion into AI. Given the accelerating demand for advanced computing power, I believe AMD is well-positioned not just for a recovery but for a breakout to new highs. The conditions for a sustained rally are falling into place—and that breakout may be closer than many expect. Disclaimer & DisclosureReport an Issue Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Business Insider
a day ago
- Business
- Business Insider
Advanced Micro Devices Stock (AMD) Poised for Breakout as AI Demand Accelerates
Advanced Micro Devices (AMD) has faced its share of volatility, with the stock down 23% over the past year. However, recent momentum suggests a potential turnaround is underway. Multiple growth catalysts are driving revenue higher, and it appears the market has yet to fully recognize this acceleration. Given these tailwinds, I'm bullish on AMD and believe the stock is well-positioned for a breakout toward its all-time highs around $200 per share. Confident Investing Starts Here: Data Center Boom Powers the AI Revolution AMD's Data Center segment is emerging as the company's growth engine—and for good reason. In Q1, the segment generated $3.7 billion in revenue, marking a 57% year-over-year increase, fueled by surging demand for its EPYC CPUs and Instinct GPUs. CEO Lisa Su pointed to deepening partnerships with major players like Microsoft (MSFT), Meta (META), and Oracle (ORCL), as hyperscalers increasingly rely on AMD's chips to power AI workloads. This momentum isn't just a one-off. Data center revenue nearly doubled in 2024 to $12.6 billion, and Q1's results continue that trajectory. AMD is further reinforcing its position through strategic acquisitions, such as Untether AI and Brium, thereby expanding its capabilities in both AI hardware and software. The upcoming Instinct MI350 series is already generating buzz for its potential to rival Nvidia in AI infrastructure. Despite the cyclical nature of the semiconductor industry, AMD's consistent data center growth, driven by rising AI demand and a strengthened ecosystem, suggests the company is well-positioned for a robust and sustained run. Client Segment: Ryzen Roars Back AMD's Client segment shouldn't be overlooked—it's staging an impressive comeback. In Q1, client revenue surged to $2.3 billion, up 68% year-over-year, driven by strong adoption of the new 'Zen 5' Ryzen processors across both laptops and desktops. AMD's Ryzen AI Max chips are at the forefront of this growth, powering over 50 AI-enabled laptop models expected to hit the market this year. But beyond the spike in sales, this signals AMD's growing presence in the PC space, particularly in AI-driven devices like Microsoft's Copilot+ PCs—a trend that could create lasting tailwinds. What's particularly compelling is the shift in market perception. Once seen as the underdog, AMD is now steadily gaining ground on Intel by delivering processors that excel in both performance and power efficiency. The Client segment's 68% jump in Q1 reflects this evolution—AMD is no longer catching up; it's setting the pace. As AI becomes increasingly integrated into everyday computing, Ryzen chips are well-positioned to keep driving growth in this segment. Strategic Moves: Betting Big on AI AMD's strategic initiatives have played a key role in fueling its recent momentum. Notably, the acquisition of ZT Systems' data center infrastructure business underscores the company's long-term ambition to lead in AI hardware. CEO Lisa Su has projected that the AI accelerator market could reach $500 billion by 2028, and AMD is positioning itself to capture a significant share. The MI235X chip, purpose-built for AI inference, targets a segment Su believes will eventually outpace AI training in market size. Collaborations are also strengthening AMD's ecosystem. From IBM (IBM) deploying Instinct MI300X accelerators to Fujitsu (FJTSF) working with AMD on sustainable AI infrastructure, these alliances are embedding AMD's technology into the fabric of global AI development. With double-digit revenue growth forecasted for the years ahead, AMD's strategic investments are increasingly looking like long-term value drivers. A Valuation That Screams Opportunity At first glance, AMD's current valuation—trading at 31x this year's consensus EPS of roughly $4—may seem steep. However, a closer look reveals a compelling growth story. Analysts project a 44% jump in EPS by 2026, reaching an estimated $5.71. That would bring the forward P/E down to a much more attractive 22x, a reasonable price for a company set to benefit from a robust, multi-year AI tailwind. Adding to the bullish case, AMD's gross margin climbed to 54% in Q1 and continues to improve as its high-margin data center segment scales. This margin expansion sets the stage for stronger profitability ahead, reinforcing the stock's long-term value. Is AMD a Good Stock to Buy? Wall Street maintains a fairly bullish view of AMD stock. AMD features a Moderate Buy consensus rating based on 22 Buy and 10 Hold ratings issued over the past three months. Notably, not a single analyst is bearish on AMD stock. AMD's average price target of $127.93 implies a modest 5% upside potential over the next 12 months, which, in my view, suggests that Wall Street is still underestimating the stock. AMD Poised for a Breakout as AI Demand Accelerates AMD appears to be at a pivotal inflection point. Its Data Center and Client segments are gaining momentum, recent acquisitions are reinforcing its position in the AI space, and the current valuation suggests the market has yet to fully price in its growth potential. While challenges like export restrictions to China and weakness in the gaming segment remain, they're far outweighed by AMD's aggressive expansion into AI. Given the accelerating demand for advanced computing power, I believe AMD is well-positioned not just for a recovery but for a breakout to new highs. The conditions for a sustained rally are falling into place—and that breakout may be closer than many expect.
Yahoo
24-05-2025
- Business
- Yahoo
Red Hat and Advanced Micro Devices, Inc. (AMD) Strengthen Strategic Collaboration to Advance AI Solutions
We recently published a list of . In this article, we are going to take a look at where Advanced Micro Devices, Inc. (NASDAQ:AMD) stands against other AI stocks that are making waves this week. Advanced Micro Devices, Inc. (NASDAQ:AMD) develops and sells semiconductors, processors, and GPUs for data centers, gaming, AI, and embedded applications. On May 20, the company announced a strategic collaboration with Red Hat, the world's leading provider of open source solutions. The collaboration aims to better support AI workloads and help companies run AI and virtual machines (VMs) faster, cheaper, and more efficiently. A close up of a complex looking PCB board with several intergrated semiconductor parts. Red Hat's industry-leading open source solutions, together with the comprehensive portfolio of AMD's high-performance computing architectures, will help organizations with the capacity and resources needed to meet workload demand and diversity rising due to artificial intelligence. The crux of the partnership is to enable businesses to manage resource-heavy AI tasks and existing virtual infrastructure without requiring major upgrades. 'By combining Red Hat's industry-leading open source platforms with world-class AMD Instinct GPUs and AMD EPYC CPUs, we're delivering the performance and efficiency customers demand to accelerate AI, virtualization and hybrid-cloud innovation.' Overall, AMD ranks 4th on our list of AI stocks that are making waves this week. While we acknowledge the potential of AMD as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and have limited downside risk. If you are looking for an AI stock that is more promising than AMD and that has 100x upside potential, check out our report about this cheapest AI stock. READ NEXT: 20 Best AI Stocks To Buy Now and 30 Best Stocks to Buy Now According to Billionaires. Disclosure: None. This article is originally published at Insider Monkey. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
11-05-2025
- Business
- Yahoo
AMD: Is It Time to Buy the Stock Before Its AI Growth Explodes?
In Q1, AMD showed why it has the potential to be a big future winner. As the AI chip market begins to shift to inference, the company has a big opportunity. The stock's valuation has come down to attractive levels. 10 stocks we like better than Advanced Micro Devices › When Advanced Micro Devices (NASDAQ: AMD) reported its first-quarter results recently, it gave a glimpse into why some investors remain excited about the stock's prospects despite its poor performance over the past year. As of this writing, the stock is down about 35% during that span. This excitement stems from the revenue growth the company is seeing in its data center segment, where sales soared 57% to $3.7 billion. While that revenue is a fraction of what rival Nvidia (NASDAQ: NVDA) generates, the growth is nonetheless robust. AMD credited its strong data center growth to its continued central processing unit (CPU) server share gains and robust growth from its Instinct graphics processing units (GPUs). AMD has recently become the leader in the data center CPU space. While GPUs provide the power, CPUs are the brains behind the operations. The market is not nearly as big as the one for GPUs in the data center space, but it's still an important and growing market. In the quarter, several cloud computing providers started to offer new computing options based on AMD's latest EPYC chips. Its CPUs also saw strong growth in the enterprise segment. AMD saw several hyperscalers (owners of massive data centers) expand their use of its GPUs for generative artificial intelligence (AI) tasks, such as AI search, rankings, and recommendations. It also said that one of the largest AI model companies is now using its GPUs to run a significant portion of its daily inference traffic. It added that big tech companies and AI start-ups are also now using its GPUs to help train their next-gen AI models. While AMD is unlikely to overtake Nvidia anytime soon, it's still seeing strong growth and solid progress in the data center space. Meanwhile, while the AI training market has been the early focus of companies as they race to build better AI models, the inference market is eventually expected to become exponentially larger. AMD has always competed better in the inference market, so this eventual shift should be a big positive for the company. While AMD's data center growth in the quarter was a highlight, not everything was coming up roses for the company. It said that it would lose out on around $700 million in revenue in the second quarter due to new export controls that would affect its MI308 GPU shipments to China. For the full year, it expects the export restriction to be a $1.5 billion headwind, with most of the effect in the second and third quarters. Nonetheless, the company still forecasts strong double-digit percentage revenue growth in 2025. For Q2, it projected revenue to be $7.4 billion, plus or minus $300 million, representing 27% growth. Given its potential growth opportunities, AMD also plans to increase investments in its product and technology roadmaps. Turning back to AMD's Q1 results, the company saw overall revenue rise by 36% to $7.44 billion. Adjusted earnings per share (EPS) surged 55% to $0.96. The results topped the analyst consensus of EPS of $0.94 on sales of $7.13 billion, as compiled by LSEG. Client and gaming segment revenue rose 28% to $2.9 billion, with client revenue soaring 68% to $2.3 billion. The growth was driven by its new high-end Ryzen CPUs, which saw strength in gaming desktop PCs and AI-powered notebooks. Gaming revenue fell 30% to $647 million due to lower semi-custom revenue. The video game console cycle is pretty long in the tooth at this point, but growth for this segment should skyrocket once new consoles are introduced, likely in late 2027 or 2028. Embedded segment revenue, meanwhile, fell 3% to $823 million. While the export restrictions on China throw a bit of a wrench in AMD's growth story, the company is otherwise seeing very good momentum in the data center space. It's the market share leader in server CPUs, which should continue to be a solid, growing market. However, the company's biggest long-term opportunity may lie in the growing demand for AI chips focused on inference rather than training. AMD's GPUs have already carved out a solid position in the inference segment, which should help drive growth given that the inference market is expected to surpass training in size over time. With its stock trading at a forward price-to-earnings ratio (P/E) of 26.5 times 2025 analyst estimates and at about 18 times 2026 estimates, AMD's valuation has come down a lot over the past year and is now at an attractive level. Given the potential AI opportunities in front of AMD, I think now could be a good time to begin accumulating shares of the stock. If the company can grab market share in the inference market, AMD stock should have a lot of upside from here. Before you buy stock in Advanced Micro Devices, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the for investors to buy now… and Advanced Micro Devices wasn't one of them. The 10 stocks that made the cut could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you'd have $617,181!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you'd have $719,371!* Now, it's worth noting Stock Advisor's total average return is 909% — a market-crushing outperformance compared to 163% for the S&P 500. Don't miss out on the latest top 10 list, available when you join . See the 10 stocks » *Stock Advisor returns as of May 5, 2025 Geoffrey Seiler has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Advanced Micro Devices and Nvidia. The Motley Fool has a disclosure policy. AMD: Is It Time to Buy the Stock Before Its AI Growth Explodes? was originally published by The Motley Fool
CNBC
06-05-2025
- Business
- CNBC
AMD earnings beat as overall sales surge by 36%
Lisa Su, CEO of AMD, attends the Artificial Intelligence Action Summit at the Grand Palais in Paris, Feb. 10, 2025. Advanced Micro Devices reported first fiscal quarter earnings on Tuesday that topped expectations, and provided a strong forecast for current quarter revenue. Shares of AMD rose in extended trading more than 4%. Here's how the chipmaker did versus LSEG expectations for the quarter ending March 29: Earnings per share : 96 cents adjusted vs. 94 cents expected : 96 cents adjusted vs. 94 cents expected Revenue: $7.44 billion vs. $7.13 billion expected For the current quarter, AMD expects about $7.4 billion in sales with a gross margin of 43% versus Wall Street estimates for earnings of 86 cents adjusted on $7.25 billion in sales. AMD's forecast also included $800 million in costs that the company said it would incur because the U.S. limited the export of some of the company's artificial-intelligence chips during the quarter. The company reported net income of $709 million, or 44 cents per diluted share, versus net income of $123 million, or 7 cents per share, during the year-earlier period. Revenue grew 36% on an annual basis. AMD is the second-place server central processing unit vendor, behind Intel , but its Epyc line of processors has been taking market share in recent years. The company is also the closest competitor to Nvidia for "big GPUs," or graphics processing units. Those are the kind of chips that are deployed in data centers by the thousands for building and deploying generative AI. It did $5 billion in AI GPU sales in the company's fiscal 2024. Both are reported in the company's data center segment, which came in at $3.7 billion in sales, topping a StreetAccount estimate. Data center sales were up 57% on an annual basis, which the company attributed to demand for both Epic processors as well as its Instinct GPUs. The company's other major segment, Client and Gaming, includes chips for consumer devices such as laptops, gaming PCs, and game consoles. The overall segment rose 28% on an annual basis to $2.9 billion. AMD said that sales for its laptop and PC chips, which it calls client revenue, surged 68% year-over-year because of strong demand for chips called Zen 5 the company released last summer. Gaming sales, however, declined 30% on an annual basis, which the company attributed to a decrease in console chip revenue. AMD's embedded segment, which is mostly sales from the company's 2022 acquisition of Xilinx, declined 3% on an annual basis to $823 million. WATCH: Chip stocks fall as Nvidia, AMD warn of higher costs from China export controls
