Advanced Micro Devices, Inc.

NASDAQ Global Select
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Bullish +75

Citi Upgrades AMD (AMD) To Buy, Citing Undervalued GPU Potential And ...

📈 Citi upgrades AMD from Neutral to Buy and raises the price target from $460 to $575 per share.

💡 Analyst Atif Malik argues the market undervalues AMD's emergence as a legitimate second source in the GPU market.

🤝 AMD secures a six-gigawatt, four-year deal with Meta including a 160 million share warrant for custom MI450 chips.

💰 Custom MI450 chips are expected to offer Meta a lower total cost of ownership versus merchant GPU products.

📊 Citi raises the 2030 CPU total addressable market estimate to $136.7 billion, up from $131.5 billion.

🚀 The revised CPU market figure represents a 36% compound annual growth rate from $29.3 billion in 2025.

📈 AMD's 2030 CPU forecast of $120 billion is exceeded by Citi's more optimistic $136.7 billion estimate.

🎯 The upgrade positions AMD as a critical supplier in Meta's artificial intelligence infrastructure buildout.

Bullish Signals
  • Citi upgrades AMD to a Buy rating and raises the price target from $460 to $575 per share, signaling strong institutional confidence.
  • Analyst Atif Malik identifies significant upside potential as investors currently undervalue AMD's role as a legitimate second source in the GPU market.
  • AMD is expected to win a lion's share of Meta's GPU business with custom MI450 chips offering lower total cost of ownership than merchant alternatives.
  • A six-gigawatt, four-year deal with Meta, including a 160 million share warrant, underscores the depth of their commercial relationship and AMD's critical supplier status.
  • Citi raises its 2030 CPU total addressable market estimate to $136.7 billion, exceeding AMD's own forecast of $120 billion for the same period.
  • The revised CPU market outlook projects a 36% compound annual growth rate from $29.3 billion in 2025, adding substantial upside beyond current valuations.
Full Analysis
Citi has upgraded Advanced Micro Devices (AMD) from a Neutral to a Buy rating, raising its price target from $460 to $575 per share. Analyst Atif Malik argues that the market significantly undervalues AMD's potential as a legitimate second source in the GPU sector, noting that investors often overlook this opportunity by viewing the company primarily through its CPU lens. The upgrade highlights AMD's strategic position with Meta, where custom MI450 chips are expected to offer a lower total cost of ownership compared to merchant alternatives. Citi believes AMD is poised to capture a significant share of Meta's GPU business, supported by a previously announced six-gigawatt, four-year deal that includes a 160 million share common stock warrant, underscoring the depth of their commercial relationship in AI infrastructure. On the CPU side, Citi revised its 2030 total addressable market estimate to $136.7 billion, up from $131.5 billion, following announcements at Computex. This represents a 36% compound annual growth rate from $29.3 billion in 2025, which exceeds AMD's own forecast of $120 billion for the same period, adding further upside to the company's growth story beyond current valuations.