The share price of Advanced Micro Devices (NASDAQ: AMD) ended the latest trading session in the green, seemingly receiving a boost from the company’s October 10 artificial intelligence event.
AMD is valued at $167, gaining over 2% in 24 hours. Indeed, the gains helped the stock end a streak of volatility seen on the weekly chart. Over the past week, the stock has plunged 1.7%, while on the monthly timeframe, AMD is up by 11%.
During the Advancing AI Event 2024, the company announced several positive developments likely to increase investor interest.
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At the forum, AMD showcased its data center and GPU advancements, including the launch of the MI325 GPU and the Turin CPU. Notably, these products aim to compete with the industry giant Nvidia (NASDAQ: NVDA), which is witnessing increased demand for its new Blackwell chips line.
At the same time, AMD shared an update on revenue, stating that it expects the AI accelerator total addressable market (TAM) to hit $500 billion by 2028. This figure reflects an increase from the 2027 estimate of $400 billion.
Analysts share AMD share price outlook
After the event, analysts shared their outlook on AMD’s share price based on the company’s advancements in AI and data center capabilities. For instance, Roth MKM analyst Suji Desilva reaffirmed a ‘Buy’ rating with a $200 price target, citing AMD’s comprehensive AI infrastructure, from chip hardware to networking solutions, as a promising platform for large-scale AI workloads.
Desilva also praised AMD’s EPYC processor, networking, and software innovations, particularly their synergy with the Instinct GPU series.
Similarly, Piper Sandler raised its target from $175 to $200, citing positive developments from the new MI325 GPU and the anticipated growth of AMD’s AI accelerator market. Piper Sandler analyst Harsh Kumar highlighted the company’s potential in the data center and GPU sectors but noted a lack of updates on AMD’s 2024 GPU revenue guidance.
“We anticipate that AMD may provide revised guidance during its upcoming Q3 earnings. We continue to see AMD as our top large-cap pick in the data center market,” the analyst noted.
Wells Fargo (NYSE: WFC) analyst Aaron Rakers, maintaining an ‘Overweight’ rating with a $205 price target, focused on AMD’s newly announced 5th Gen EPYC Turin CPUs. These CPUs were launched alongside AMD Instinct MI325X accelerators, enhancing the company’s AI offerings.
Built for scale-out and cloud workloads, these CPUs offer up to 192 cores and showcase significant performance improvements over Intel’s (NASDAQ: INTC) Emerald Rapids data center CPUs.
Oppenheimer took a more cautious stance, describing AMD’s AI event as “uneventful,” with expectations for future MI3XX family revenue tempered by current sales forecasts. Oppenheimer expressed neutrality, suggesting that AMD’s AI ambitions are still evolving in investors’ eyes.
“We found AMD’s AI day to be largely uneventful, with management mostly reiterating already well-understood product roadmaps,” the firm noted.
Notably, during the second quarter, AMD’s AI advancements appeared to pay off, with the company beating analyst estimates by posting revenue of $5.8 billion. The data segment stood out, with revenue growth of 115% to $2.8 billion.
Beyond the AI space, AMD has focused on expanding its cloud computing segment, with a notable collaboration with Oracle (NYSE: ORCL) Cloud Infrastructure. This partnership aims to power Oracle’s new AI supercluster with AMD’s Instinct MI300X accelerators.
AMD’s stock technical setup
Regarding AMD’s technical setup, TrendSpider’s analysis highlighted the stock’s current consolidation within a large triangular pattern on the weekly chart. After a recent high above $176, the stock is trading near $167, positioned at the convergence of a long-term ascending trendline and a descending resistance line.
The relative strength index (RSI), at 55.43, suggests building buying pressure and hints at a potential breakout from its downward trendline. A successful move above the $176 resistance could extend AMD’s bullish trend, while failure to break through might prompt a retest of support around $146.
In summary, AMD’s recent advancements showcased at the Advancing AI have partly bolstered investor optimism. With a promising growth outlook in AI, cautious perspectives from some analysts indicate that the company’s full potential is still unfolding.
