Oppenheimer upgraded Advanced Micro Devices (NASDAQ: AMD) from “Perform” to “Outperform” on November 9, setting a new AMD stock price target of $600.
The firm became more bullish on strong data center performance and growing demand for AMD’s artificial intelligence (AI) chips following the latest earnings call.
After some discussions with CFO Jean Hu and Vice President of Investor Relations Matt Ramsay, the firm also highlighted server CPUs and initial MI455 and Helios shipments as key drivers of approximately doubled data center growth.
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Looking ahead, Oppenheimer expects data center revenue to accelerate further through 2027, with GPU sales eventually surpassing EPYC server CPU revenue. At the same time, AMD management expects overall revenue growth to exceed 80% in 2027.
Data center growth drives AMD stock price target up
Oppenheimer estimates that AMD will reach approximately 3 gigawatts of data center capacity in 2027 and 4 gigawatts in 2028. As a result, it also believes data center revenue will increase 135% next year and eventually account for approximately 85% of total sales.
The figures will be supported by the company’s plans to maintain an annual product release schedule. Notably, MI500 is expected in 2027 and MI600 is set to follow in 2028, allowing AMD to remain competitive in the AI accelerator market.
On the demand side, Oppenheimer expects OpenAI and Meta (NASDAQ: META) to support data center growth through the first quarter next year, followed by another batch of orders from Anthropic in later quarters.
What’s more, AMD shares could also benefit from a growing demand for high-performance computing and related infrastructure investments, with the five largest cloud service providers expected to spend approximately $1.3 trillion on capital expenditures in 2027, up from $800 billion in 2026.
“We see favorable pricing trends as AMD negotiates next-gen deals as an incumbent. Compute-heavy agentic Al a tailwind to GPU and CPU,” the firm wrote.
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Wall Street welcomes AMD’s Q3 results with open arms
Other Wall Street firms have also responded positively to AMD’s results. For instance, DA Davidson raised its price target to $600 while maintaining a “Buy” rating, while StoneX reiterated “Buy” with an AMD stock price target of $685 target.
TD Cowen maintained its “Buy” rating and $675 AMD price target, highlighting the company’s strong quarterly performance. Likewise, Baird reiterated its “Outperform” rating and Street-high $1,250 price target.
Oppenheimer’s upgrade thus reinforces the growing importance of AMD’s business model, especially its data center efforts, and the market’s optimism that it can succeed.
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