AMD's analyst day is just hours away. Can it power the stock even higher?

By Britney Nguyen

The chip maker is expected to deliver a clearer view of its long-term AI strategy, but the company might not be able to give information on what matters most to investors

AMD is hosting its analyst day on Tuesday.

Advanced Micro Devices Inc. beat earnings expectations earlier this month, but faces an even bigger test on Tuesday, when the company will share more numbers about its long-term vision for artificial intelligence.

Those projections could be even more important to Wall Street than routine quarterly results because AMD (AMD) is gearing up for a big increase in its AI business, starting with a large OpenAI deal that will start to kick in meaningfully toward the end of next year.

See more: AMD just passed one test - but it's not done yet

Bank of America's Vivek Arya said in a Friday note that he expects AMD to raise its outlook around the total addressable market (TAM) for AI accelerators to between $750 billion and $850 billion by the end of the decade. Previously, AMD had estimated that market opportunity to be more than $500 billion by 2028. AMD and Nvidia Corp. (NVDA), which make graphics-processing units, could together command three quarters of that market, according to his estimates, while makers of application-specific integrated circuits could win the balance of business.

But while Arya and other analysts are expecting AMD to raise its TAM guidance, Wedbush's Matt Bryson said in a Monday note that his team thinks "it will be difficult for AMD to move the needle" for its stock with its analyst day announcements, "as the largest x-factor is not TAM, but rather quality and delivery timing of the MI400 parts, which in turn will define AMD's revenue trajectory."

Bryson said he expects AMD to share more details on the features of its MI400 series, which will be deployed next year, and clues on its MI500 series, which will follow the MI450 series that is being deployed with OpenAI. AMD's stock has climbed 48% since it announced a partnership to deploy 6 gigawatts of its systems with OpenAI in early October.

See more: AMD's stock soars to its best day in a year. Here's why OpenAI wants a stake.

Arya expects the chip maker to announce a double-digit share target within the GPU market, which would equate to about $55 billion to $65 billion in GPU sales. The long-term sales guidance that Bank of America projects "is also generally in-line with AMD's pre-OpenAI deal outlook" for $15 billion to $20 billion per year "in the out years." Arya said he sees AMD's earnings power reaching $15 to $18 by 2030, "assuming a full 6 [gigawatt] AI deployment by OpenAI and related dilution."

Investors will also be focused on AMD's customer diversification outside of its partnerships with OpenAI and Oracle (ORCL), Arya said, "particularly given the OpenAI deal's equity/warrant nature."

Under the agreement between AMD and OpenAI, the AI startup has a warrant to buy up to 160 million shares of the chip maker's common stock at 1 cent per share, which will vest as the companies reach specific milestones. The offer translates to just under 10% of AMD, based on the number of outstanding shares. The first vesting is expected when the first of the 6 gigawatts is deployed, and AMD has to reach certain share-price targets as part of the agreement.

Bryson said AMD could announce "perhaps even an incremental large customer," noting long-held expectations for Amazon.com (AMZN) to become a major partner for AMD's chips.

Meanwhile, Arya said AMD's execution of its first rack-scale solution, Helios, is "one of [the] key risks" - especially as rival Nvidia prepares to launch its third-generation rack-scale product with its Rubin platform in the second half of next year.

As the "first of its kind" for AMD, Helios's "execution in supply chain, yield, overheating will be critical to the program success," Arya said.

In Bryson's view, even if AMD grows its TAM forecast and gives investors more insight into its MI400 and MI500 series, "with deltas tied to execution, we are less clear as to how AMD significantly shifts expectations until the MI400 series parts get closer to shipping and details around the parts filter out."

While AI is the hottest topic for AMD, Bryson said investors will likely take a positive view of announcements by AMD on its central processing units for personal computers and servers. His team is "most interested" in what AMD shares about longer-term expectations for the compute TAM "in light of the apparent incremental demand server CPUs have been seeing related to AI." And color from AMD on the AI PC market would be an indicator of broader AI adoption, Bryson said.

-Britney Nguyen

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11-11-25 1021ET