Advanced Micro Devices (AMD) is attracting renewed attention as the company prepares for its upcoming AI conference, “Advancing AI 2024,” scheduled for October 10, the Street reports.
This event is expected to showcase AMD’s next-generation Instinct accelerators, 5th Gen EPYC processors, and updates in Networking and AI solutions. The chipmaker’s advancements in artificial intelligence (AI) technology are key topics for investors, with analysts adjusting their stock forecasts ahead of the conference.
CEO Lisa Su emphasized AMD’s rapid pace in AI development during a recent interview at the Goldman Sachs Communacopia & Technology Conference, expressing amazement at how fast the sector is evolving. Su said that the company had learned more in the past 9 to 12 months than in previous years due to the rapid pace of AI innovation. She projected the AI market could grow to $400 billion by 2027, highlighting AMD’s strategic investments to stay competitive in this expanding field.
AMD has been focusing on long-term goals, with Su stating that the company is “making bets five years out” rather than concentrating solely on short-term results. One of these forward-looking investments is the recent $4.9 billion acquisition of AI infrastructure provider ZT Systems, which is expected to enhance AMD’s presence in the data center market. Citi analysts reiterated their buy rating on AMD with a $210 price target following the deal, noting that it should help AMD better compete with rival Nvidia in the data center GPU market.
However, analysts are also weighing potential near-term challenges for AMD. Citi Research’s Christopher Danely pointed to weaker-than-expected recovery in the PC market, following conversations with key industry players such as Intel, Dell, and Western Digital. While notebook shipments rose 15% month-over-month in August, the increase was seen as a reflection of weak demand in July rather than significant market growth. Danely warned that the end of inventory replenishment in PCs could present a “mild headwind” in the near term for AMD.
Despite these potential challenges, AMD’s overall trajectory remains positive. The company has reported strong financial performance, with data center revenue more than doubling year-over-year in its most recent quarter, driven by Instinct MI300 GPU shipments and increased EPYC CPU sales.
