AMD Stock Rises 6% as AI Market Opportunity Climbs to $3T

AMD shares jumped roughly 6% and closed at $508.38 after the chipmaker raised its estimate of the AI total addressable market to $3 trillion by 2030. The stock’s year-to-date gains topped 120% following the update.

The forecast was presented Tuesday by Chief Financial Officer Jean Hu at an investor conference. The company’s prior estimate in July placed the market opportunity near $2 trillion; the new figure reflects stronger demand for GPUs, CPUs and AI-enabled personal computers.

Company executives highlighted a shift in compute demand from model training to inference, the phase when trained models run tasks. Management noted workloads are expanding beyond basic chatbot functions into more autonomous AI applications, making inference the primary driver of AI computing in the past year.

AMD projects its data center business will more than double next year. The firm plans to launch the MI450 GPU this quarter, with production ramping in the fourth quarter and into 2027. AMD is also working with key customers on next-generation MI500 and MI600 accelerators and has disclosed a technical partnership with Cerebras to pursue low-latency inference use cases.

Server CPU demand has improved, and AMD said it has increased supply amid market constraints. The company expects CPU business growth of more than 80% in the second half of this year versus the same period in 2025 and forecasts server CPU growth above 70% next year.

Orders for rack-scale Helios systems include Meta Platforms and two unnamed AI labs as anchor customers. All three provided demand forecasts that exceed their initial purchase agreements, and AMD reported that Helios volume expectations for 2027 have already surpassed earlier projections. The company also cited rising interest from newer cloud providers.

AMD acknowledged that data center GPUs currently generate profit margins below the corporate average. Expansion in higher-margin server and embedded segments is helping offset that pressure, with management projecting strong double-digit revenue growth in the second and third quarters.

Financials were mixed across divisions. Data Center revenue rose 107% year over year, and AMD secured a 6GW GPU agreement with OpenAI. Gaming revenue fell 31% year over year to $779 million.

Over the past year the stock has climbed about 230%, though it declined nearly 5% over the past week and about 6% in the last month. Analyst coverage includes five strong-buy ratings, 36 buys and 10 holds, with an average price target of $613.84.

AMD executives flagged risks that could affect the outlook, including potential export controls on AI accelerators, memory supply constraints and tariffs. At the conference, Jean Hu said, “This AI super investment cycle is at the very beginning, and over time, we’re going to continue to see strong demand for AMD’s product.”