TLDR
- AMD stock surged over 18% after beating Q1 earnings estimates with $10.25B in revenue and $1.37 EPS
- Datacenter revenue hit $5.78B, up 57% year-over-year, driven by server CPU demand
- Q2 guidance of $11.2B came in well above Wall Street’s $10.5B estimate
- Goldman Sachs and Bernstein both upgraded AMD to Buy, with price targets of $450 and $525 respectively
- OpenAI and Meta announced strategic GPU partnerships with AMD, deploying 6 gigawatts of AMD GPUs
Advanced Micro Devices stock jumped over 18% on Wednesday after the company posted Q1 results that topped Wall Street expectations across the board.
Advanced Micro Devices, Inc., AMD
AMD reported revenue of $10.25 billion, beating estimates of $9.9 billion. Earnings per share came in at $1.37, above the $1.28 consensus.
The stock was trading around $421 during the session, up from roughly $355 the day before.
Datacenter revenue was the headline number, coming in at $5.78 billion — up 57% year-over-year. Server CPU strength was the primary driver.
For Q2, AMD guided revenue to $11.2 billion. That’s comfortably above the Street’s $10.5 billion estimate. Datacenter revenues are expected to grow double-digits sequentially, and server CPUs are forecast to grow more than 70% year-over-year.
Trading volume told its own story. More than 54 million AMD stock changed hands on Wednesday, well above the three-month daily average of around 32.47 million.
Analyst Upgrades Roll In
Goldman Sachs upgraded AMD to Buy and raised its price target to $450 from $240. Analyst James Schneider cited agentic AI as a structural tailwind for AMD’s server CPU business, calling AMD an “outsized beneficiary” of enterprise AI adoption.
Bernstein upgraded AMD to Outperform from Market-Perform, lifting its target from $265 to $525. Analyst Stacy Rasgon now models AMD earning more than $14 per share in 2027, with earnings potentially approaching $20 in 2028.
Rasgon noted AMD’s total addressable market outlook has doubled, with management now projecting a 35% CAGR through 2030, reaching roughly $120 billion.
Seaport Research analyst Jay Goldberg upgraded AMD to Buy from Neutral with a $430 target, pointing to surging CPU demand and an increasingly attractive GPU outlook for next year.
Raymond James kept its Buy rating and lifted its target to $455 from $365. Robert W. Baird went further, boosting its target to $625 from $300. DBS reiterated Buy with a $500 target.
GPU Partnerships Add to the Story
OpenAI and Meta have both announced strategic partnerships with AMD to deploy 6 gigawatts of AMD GPUs. Goldman Sachs flagged the Meta deployment as particularly compelling.
Bernstein noted AMD’s two anchor GPU customers are “set to ramp into year-end,” and said those figures haven’t yet been fully reflected in Street models.
Seaport also flagged that AMD secured better-than-expected chip allocation from TSMC, which could support near-term supply.
Rosenblatt Securities analyst Kevin Cassidy, considered the top-rated analyst on AMD, carries an 80% success rate over the past three months with an average return of 31.79% per rating. Over two years, his success rate sits at 100% with an average return of 191.49%.
AMD’s year-to-date gain now stands at 94.47%, with the stock up 253.99% over the past 12 months.
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