Santa Clara, California, May 7, 2026, 13:13 PDT
Shares of Advanced Micro Devices slipped Thursday, giving back some ground after a big run-up following its earnings. Still, the core takeaway from the company’s latest results stayed intact: AI spending is pushing further into servers, and AMD is capturing more of that flow. The stock last traded at $408.42, off $12.97 from the prior close, reversing part of Wednesday’s jump sparked by a robust forecast.
That’s a key shift for AMD. The market isn’t looking at the company just as a laggard trying to catch Nvidia in AI GPUs anymore. CEO Lisa Su is pushing a bigger pitch: she says AI inference—actually running models in real-world settings—and agentic AI, which handles multi-step tasks, are both pushing up the need for CPUs, the main server workhorses.
That opens up another front for AMD against Nvidia, the clear leader in AI chips, and drags it back into a more intense rivalry with Intel in the server processor space. Investors just got new proof points in the first-quarter report: revenue jumped 38% to $10.25 billion, with data-center sales surging 57%, landing at $5.8 billion. For the second quarter, AMD is targeting revenue of roughly $11.2 billion, give or take $300 million.
Su pointed to “Data Center” as AMD’s biggest growth engine, citing demand for EPYC server chips and Instinct AI accelerators. The company bumped up its server CPU market outlook, projecting annual growth above 35% and a market exceeding $120 billion by 2030—far higher than the 18% yearly increase AMD forecast in November. AMD
The real driver came from AMD’s near-term outlook. Management projected server CPU revenue jumping more than 70% year over year in Q2. Helios rack-scale AI systems and MI450 chips, both, are slated to hit volume shipments in the back half. Meta, for its part, is planning to roll out as much as 6 gigawatts’ worth of AMD Instinct GPUs—OpenAI is in the mix as a major AI infrastructure client, too.
Analysts didn’t waste time. According to Reuters, at least 20 brokerages hiked their AMD price targets after earnings, with Evercore ISI standing out at $579—the highest on Wall Street, LSEG data shows. “AMD’s story is now about a broader compute opportunity,” said Matt Britzman, senior equity analyst at Hargreaves Lansdown, pointing to both CPUs and GPUs as demand from AI workloads ramps up. Reuters
Barclays hiked its price target on AMD to $500 from $300, according to Business Insider. Goldman Sachs took its target to $450 and bumped AMD up to a buy, with Jefferies also raising its view—$415 versus the previous $300. Barclays analysts described AMD as “one of the most interesting plays in AI right now.” Goldman pointed to AMD’s potential upside tied to enterprise agentic AI adoption, thanks to its server CPU segment. Business Insider
Not all the analyst takes were buy calls. Steven Cress, who leads quantitative strategies over at Seeking Alpha, flagged AMD’s Q1 revenue pop and stronger data-center appetite, but noted the stock is trading at a hefty valuation. The Seeking Alpha quant ranks still have AMD at “Hold,” with Cress highlighting Micron and SanDisk as AI chip players that look more reasonably priced. Seeking Alpha
Competition hasn’t let up. Reuters points out that while AMD still stands as Nvidia’s chief rival in AI GPUs, Intel is stepping up its own chip production just as CPU demand heats up. AMD, meanwhile, depends on external foundries like TSMC—so if the appetite for AI servers keeps rising, capacity could turn into a limiting factor.
There are still a few hurdles. Su flagged “tightness” across both the supply chain and data-center construction but reiterated AMD’s confidence in hitting growth targets. The outlook for PC shipments in the back half of the year is weaker, the company said, citing pricier memory and components. Chief Financial Officer Jean Hu noted MI450 chips will come in below AMD’s average gross margin. The Motley Fool
Valuation is another hurdle for the rally. According to Reuters, AMD is changing hands at roughly 42.4 times forward earnings—well above its five-year average of 30, and almost twice Nvidia’s multiple, even though Nvidia controls a bigger slice of the AI market. That puts extra weight on AMD delivering with MI450, Helios, and its server CPUs—numbers alone aren’t enough.
AMD has shifted the conversation around its shares. The focus isn’t solely on a single data-center growth print; bigger questions are in play—mainly whether CPUs will take on a larger role in AI infrastructure than Wall Street expected just months back. According to Yahoo Finance, AMD notched a 13.3% gain for the week. Some of that rally faded in recent trading.
