Earlier this month, we noted, “Shares of Advanced Micro Devices (NASDAQ: AMD) exploded by more than $50 a share on strong earnings and guidance. And while the stock is taking an expected breather after such an explosive move, AMD could see further upside.”

At the time, AMD traded at $412.83. Today, it’s up to $531 and could rally even higher. All thanks to strong demand for the company’s AI accelerators, expanding data center business, and growing adoption of its Instinct GPU platform among some of the world’s largest tech companies. Better, analysts at Barclays just raised their price target on AMD to $665 with an overweight rating.

“CPU-to-GPU ratios are narrowing as CPU demand reaches new levels in the rapidly expanding world of agentic AI,” said the firm, as quoted by The Street. “AMD is best positioned to benefit from this transition.” That is the core of the note, and it represents a meaningful departure from the way the AI chip story has been told for the past two years.

Recent earnings have also been strong.

In its first quarter, the company’s EPS of $1.37 beat by eight cents. Revenue of $10.25 billion, up 37.8% year over year, beat by $330 million. 

Better, as quoted from the company’s earnings release, “We delivered an outstanding first quarter, driven by accelerating demand for AI infrastructure, with Data Center now the primary driver of our revenue and earnings growth,” said Dr. Lisa Su, AMD chair and CEO. “We are seeing strong momentum as inferencing and agentic AI drive increasing demand for high-performance CPUs and accelerators. Looking ahead, we expect server growth to accelerate meaningfully as we scale supply to meet demand. 

Sincerely,

Ian Cooper