The reviews are in and, well, they’re … mixed.
We’re not talking about critics covering the premiere of a Broadway show or a Hollywood movie, but rather analysts’ reactions to Advanced Micro Devices’ (AMD) “Advancing AI 2024” event in San Francisco.
Related: Analyst updates AMD stock price forecast ahead of AI event
The company used the presentation to launch what it called “the latest high performance computing solutions defining the AI computing era.” That lineup included 5th Generation AMD EPYC server central processing units, AMD Instinct MI325X accelerators and Ryzen AI Pro 300 Series PC processors.
Chairwoman and CEO Lisa Su said the MI325X would start shipping at the end of the current quarter and would be in the field in partner products in the first quarter of next year.
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AMD also updated its forecast for the data-center AI accelerator market.
The tech giant sees the total addressable market growing by a factor of 11 to more than $500 billion in 2028 from $45 billion in 2023. Its earlier estimate was $400 billion in 2027.
AMD CEO: Data center and AI ‘significant growth opportunities’
“The data center and AI represent significant growth opportunities for AMD, and we are building strong momentum for our EPYC and AMD Instinct processors across a growing set of customers,” Su said in a statement.
TheStreet Pro’s Helene Meisler reviewed the company’s stock performance and told readers that “it is incredible when you sit back and realize that AMD has gone nowhere all year.”
Related: Analysts reset AMD stock outlooks after AI acquisition
“It peaked in March, tried to rally this past summer, and now, with all the hoopla over its new AI whatever, it still can’t get to the summer high let alone the spring one,” she said on Oct. 10.
AMD shares closed Friday at $167.89, up 2.3% on the day but down 1.8% on the week. The shares are up 13.9% on the year.
“It’s got some support here at $160, more down at $150,” Meisler said. “It wouldn’t surprise me to see it remain in this sideways pattern between $150 and $180 for a while longer.”
Investment firms issued research reports after the company’s presentation.
Oppenheimer said that it viewed AMD’s artificial intelligence day as “largely uneventful,” noting that management recapped “already well understood” product road maps.
Discussions with investors reveal MI3XX family revenue expectations in 2025 around $10 billion, but Oppenheimer says actual sales could come closer to $8 billion, the analyst tells investors in a research note.
“Unfortunately investor expectations have remained persistently out of reach,” the firm said.
Oppenheimer said that it remained sidelined on the shares “as AMD’s AI vision proves out.”
Wedbush analysts, who maintained their outperform rating and $200 price target on the shares, said AMD did not update AI sales guidance or announce any new large customers.
“While we don’t necessarily expect an updated guide or a new customer, we believe such potential for either outcome was baked into AMD’s valuation,” the firm said.
Analyst: ‘No big surprises’ at AMD event
“As such, the one arguably new financial oriented detail with AMD forecasting a $500 billion [total addressable market] in 2028 was not enough to sustain the stock’s recent strength,” Wedbush added.
The firm sees AMD’s confidence around “continued (if not accelerated) growth as positive for peer Nvidia (NVDA) as well as the leading ASIC-based suppliers.” That’s a reference to an application-specific integrated circuit, an IC chip customized for a particular use.
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Analysts at Bank of America Securities maintained their buy rating and $180 price target on AMD, telling investors that the company provided an update to its end-to-end AI infrastructure platform
“While investor expectations might have been high after last year’s MI300X launch event, from a high level there were no big surprises to the AI product roadmap or its competitiveness,” the firm said.
“Importantly, new MI325X performance generally remains a full year behind NVDA’s latest Blackwell, with no near-term catalyst to change the dynamic.”
“However, we highlight AMD’s multivector growth opportunities across data-center CPUs and GPUs remain unchanged,” B of A said.
Piper Sandler lifts AMD target
On the more positive side, Piper Sandler raised its price target on AMD to $200 from $175 and affirmed an overweight rating on the shares.
After attending AMD’s artificial intelligence event, the analyst remains “enthused” about the company’s prospects, particularly around its data center and GPU offering.
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As expected, AMD launched its newest data-center product including the MI325 GPU as well as the Turin CPU, the firm told investors.
Piper also flagged that AMD increased its AI-accelerator total addressable market expectations to $500 billion by 2028 from $400 billion by 2027.
The firm said AMD will have “significant share in this market.” Piper continues to see the company as well positioned in the data center market and views the stock as its top large-cap pick.
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