Truist Securities recently upgraded Advanced Micro Devices following the announcement of a major partnership by IBM and AMD to co-develop quantum-centric supercomputing architectures, aiming to create scalable platforms that integrate quantum and classical computing for advanced workloads.
This collaboration is seen as a move that could accelerate AMD’s momentum in the highly competitive AI and data center markets, highlighting the company’s potential to drive innovation in next-generation computing solutions.
We’ll explore how the IBM partnership could influence AMD’s investment narrative, especially in regard to its AI and data center ambitions.
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To invest in AMD, you have to believe in the company’s ability to capture and hold share in the AI and data center markets through sustained innovation and large-scale adoption of its high-performance compute platforms. The IBM partnership around quantum supercomputing draws fresh attention to AMD’s AI ambition but does not immediately alter the most important near-term catalyst: execution on accelerated AI chip roadmaps and data center wins. The biggest risk remains execution shortfalls in hyperscaler adoption, regulatory barriers, or overestimation of near-term AI revenue.
AMD’s recent collaboration with Aligned and USC ISI on the MEGALODON language model is especially relevant. This partnership reinforces AMD’s strategy of positioning its GPUs for AI training at scale, aligning tightly with its broader ambitions to expand in advanced computing following the IBM news. These developments continue to underline the importance of the data center and AI ramp as central catalysts.
In contrast, investors should be aware of the risk of prolonged export restrictions and new compliance costs that could quickly shift sentiment…
Read the full narrative on Advanced Micro Devices (it’s free!)
Advanced Micro Devices’ narrative projects $46.2 billion revenue and $9.0 billion earnings by 2028. This requires 18.5% yearly revenue growth and a $6.8 billion earnings increase from $2.2 billion today.
Uncover how Advanced Micro Devices’ forecasts yield a $184.67 fair value, a 11% upside to its current price.
Some of the lowest analyst forecasts for AMD included only US$44,300,000,000 in annual revenue by 2028 and flagged export restrictions as a major risk. These analysts paint a far more cautious story, reminding you that expert views differ widely, and both risks and opportunities may need to be reevaluated as new developments like the IBM partnership arise.
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