AMD stock is trading around $506, up 136% year-to-date, making it one of the standout performers of 2026. The rally has been fueled by surging demand for AI chips, with the company posting a 50% jump in Q2 FY26 revenue. Data center sales led the charge, climbing 107% year-over-year.
Advanced Micro Devices, Inc., AMD
CEO Lisa Su raised the bar further during the Q2 earnings call, saying AMD now expects its data center revenue to double in 2027. Server revenue is also expected to grow more than 80% annually in the second half of FY26.
The numbers have kept Wall Street firmly in the bull camp. Of 33 analysts covering the stock, 27 rate it a Buy, with six holding a neutral stance. The average price target sits at $647, pointing to roughly 28% more upside from current levels.
Bank of America analyst Vivek Arya reiterated his Buy rating with a $620 price target. He described AMD as the “best-positioned CPU vendor” and raised his 2030 server CPU total addressable market estimate to $210 billion, up from $170 billion. That compares to a market of just $35 billion in 2025.
Arya pointed to AMD’s Zen 6 Venice CPU as a key differentiator. It offers up to 256 cores and 512 threads, ahead of Intel’s Diamond Rapids at 192/192 and Nvidia’s Vera at 88/176.
AMD recently announced a partnership with Microsoft to deploy its Helios platform, AMD’s all-in-one AI rack system combining GPUs, CPUs, networking, and software. Microsoft plans to use it for frontier model inference workloads.
The deal is being read as a vote of confidence from one of the biggest names in enterprise AI. Frontier models are the most advanced AI systems available, so deploying AMD hardware there carries weight.
Inference is also a growing part of the AI workload picture. As the initial wave of AI training slows, inference is expected to make up the majority of compute demand going forward. If AMD captures a solid portion of that market, it could close the gap with Nvidia meaningfully over time.
Phillip Securities analyst Yik Ban Chong has a Buy rating and a $755 price target. He flagged that AI startup Anthropic is expected to deploy 2 GW of AMD’s MI450 GPUs in the Helios platform from the first half of next year, which he projects could add $30 billion to AMD’s revenue.
Not everyone is ready to chase the stock at current levels. AMD is trading at roughly 68 times forward earnings. Nvidia, by comparison, trades at 25 times forward earnings and is growing faster.
Chong did cut his FY26 profit estimate by 8%, citing weak demand in AMD’s client and gaming units, which face pressure from elevated memory costs.
The Microsoft partnership is a step in the right direction, but some analysts argue the stock has already priced in a lot of good news. AMD needs more major client wins to justify where it trades today.
The Anthropic MI450 deployment, expected to begin in the first half of 2027, will be closely watched as a signal of whether AMD can back up its premium valuation with results.
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