Advanced Micro Devices (AMD) stock has risen 39% year-to-date, thanks to improved sentiment about the chip giant’s ability to capture the demand for artificial intelligence (AI) graphics processing units (GPUs) and continued gains in the central processing unit (CPU) market. While concerns related to U.S.-China trade tensions and intense competition persist, most analysts remain bullish on AMD stock and see further upside.
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Advanced Micro Devices reported mixed results for the second quarter of Fiscal 2025. The company impressed investors with a 32% growth in Q2 revenue and better-than-anticipated guidance for the third-quarter top line. However, AMD’s Q2 earnings per share (EPS) were in line with expectations. Moreover, the company’s AI business revenue declined year-over-year in Q2 FY25, as U.S. export restrictions eliminated MI308 sales to China, and the company began transitioning to its next-generation offering.
Analysts’ Bullish Thesis on AMD Stock
While critics are concerned about ongoing challenges, including the trade disputes between the U.S. and China, rising operating expenses, and the stock’s valuation, AMD bulls remain confident about the company’s growth prospects. Bulls are particularly optimistic about AMD’s AI-powered PC processors, demand for EPYC server chips, and the upcoming Instinct MI400 AI chips and other launches. Moreover, they are upbeat about AMD’s MI355 AI chips, which offer comparable performance to Nvidia’s (NVDA) Blackwell GPUs. Overall, AMD bulls expect the AI boom to drive continued momentum in the company’s data center business and support a further rise in the stock.
In reaction to the Q2 FY25 results, TD Cowen analyst Joshua Buchalter raised the price target for AMD stock to $195 from $165 and reiterated a Buy rating. The 4-star analyst stated that AMD’s Q3 outlook indicates a solid MI355 ramp in the second half of 2025, which should mitigate investor concerns and slowly build confidence in the crucial MI400/Helios launch in 2026. Buchalter highlighted that AMD expects continued growth in its Instinct chips in Q4 FY25 due to notable new customer interest.
Likewise, Mizuho analyst Vijay Rakesh raised the price target for AMD stock to $205 from $183 and reiterated a Buy rating. The 5-star analyst increased his revenue and EPS estimates for the September quarter and for Fiscal Years 2025 to 2027. Rakesh expects AMD to gain from MI308 ramps in China (as the Trump administration lifted the export restrictions on these chips recently), while MI355 provides an opportunity for upside, given Microsoft’s (MSFT) strong capital spending expectations for Fiscal 2026.
Is AMD Stock a Buy or Sell Now?
Overall, Wall Street has a Moderate Buy consensus rating on Advanced Micro Devices stock based on 25 Buys and 11 Holds. The average AMD stock price target of $183.97 indicates 10% upside potential from current levels.
