AMD stock surge as analysts stay bullish on AI demand

Shares of Advanced Micro Devices (NASDAQ: AMD) rose on Monday as analysts reiterated bullish views on the company’s long-term artificial intelligence growth prospects.

AMD shares gained about 3.5% to $200.17 during the session, extending optimism around the chipmaker’s expanding role in the rapidly growing AI infrastructure market.

Analysts say the company’s data center business, hyperscaler partnerships, and AI chip roadmap continue to support the longer-term investment thesis.

Analysts reaffirm bullish outlook on AMD

Several research firms reaffirmed positive ratings and price targets for AMD over the past few days.

RBC Capital reiterated a “Hold” rating on AMD with a $230 price target, noting continued strong demand for the company’s upcoming AI products.

The bank said demand for the MI450 GPU and Helios systems remains robust, highlighting increasing hyperscaler interest.

According to RBC, the second half of 2026 could see rising deployment volumes from major customers such as OpenAI and Meta, despite AMD having no additional warrant-based agreements planned.

Wolfe Research also reiterated its “Outperform” rating and $300 price target.

The brokerage acknowledged some caution around certain segments but remained optimistic about AMD’s broader momentum.

“In general, we think the company expressed some incremental caution with respect to client and gaming due to the widely anticipated impact from higher memory pricing. However, we also got the sense that server momentum continues to improve,” analyst Chris Caso wrote.

Caso added that demand for the company’s AI products continues to support investor confidence.

“AMD also continues to express confidence in its roadmap and customer traction for AI accelerators, which is what is ultimately important for the stock.”

AI partnerships and hyperscaler demand drive growth

AMD’s expanding partnerships with large technology companies have also strengthened its AI infrastructure pipeline.

The company recently signed a multi-year agreement with Meta Platforms to deploy up to six gigawatts of Instinct GPUs, representing one of the largest AI hardware partnerships announced in the industry.

The first phase of deployment is expected to begin in the second half of 2026 using Helios systems powered by MI450 GPUs and sixth-generation CPUs, running AMD’s ROCm software platform.

AMD also previously reached a six-gigawatt deployment agreement with OpenAI in October 2025, further boosting its long-term revenue pipeline for AI infrastructure products.

In addition, hardware manufacturer Celestica is partnering with AMD to help build systems supporting the Helios AI architecture.

Celestica will design and manufacture the high-speed switches required to connect AMD’s next-generation AI chips in rack-scale computing systems.

These rack-scale AI platforms are designed as large prebuilt computing environments capable of running advanced artificial intelligence models for cloud providers, enterprises, and research organizations.

Data center growth supports AMD’s long-term outlook

Despite volatility in the stock price, AMD’s underlying business performance has remained strong.

The company reported fourth-quarter 2025 revenue of $10.27 billion and adjusted earnings per share of $1.53.

Growth was largely driven by the company’s data center segment, which generated $5.4 billion in revenue, representing a 39% year-over-year increase.

The strong performance reflects accelerating adoption of EPYC server processors and Instinct AI accelerators among enterprise and cloud customers.

Demand for high-performance CPUs is also rising as companies build new data centers to support emerging AI workloads.

According to AMD, many customers are constructing new CPU-based data centers designed to support AI systems, which require both GPUs and high-performance processors working together.

The company also reported strong demand for customized versions of its MI400 and MI500 series GPUs, particularly for hyperscale clients.

For example, AMD plans to tailor MI400-series solutions for Meta, modifying chiplet configurations and compute sled designs to improve overall cost efficiency.

Wall Street sentiment remains positive overall.

According to data compiled by TipRanks, 30 analysts have collectively rated AMD shares a “Moderate Buy”, with an average price target of $285.

Based on current levels around $197, that target implies nearly 45% potential upside over the next 12 months.