AMD·Advanced Micro Devices, Inc.

AMD is experiencing a mix of positive and competitive pressures. DigitalOcean's expansion of its Agentic Inference Cloud with AMD Instinct™ MI350X GPUs is a recent positive development. This collaboration aims to provide cost-efficient, high-performance solutions for AI inference workloads, with MI355X GPUs slated for deployment next quarter. This matters because it expands AMD's reach in the AI market, potentially driving revenue growth in the near term. However, Nvidia's move into the CPU market, fueled by a deal with Meta, introduces a direct competitive challenge to AMD. This could pressure AMD's pricing and margins, creating uncertainty about its future profitability. The market will be watching closely to see how AMD responds to this increased competition. Adding to the positive outlook, Benchmark reiterated a Buy rating for AMD, projecting tens of billions in AI revenue by 2027. The firm highlights AMD's growing presence in the AI sector, particularly in the data center market. This positive outlook is driven by AMD's ability to capitalize on the expanding AI market, especially as demand for an alternative to Nvidia's architecture grows.