Advanced Micro Devices (AMD) has added another important milestone to its artificial intelligence (AI) growth story this month. On July 22, AMD shares popped 1.45% after the chipmaker announced a multi-billion-dollar strategic partnership with AI startup Anthropic, further strengthening its presence in the fast-growing AI infrastructure market. Under the agreement, Anthropic will deploy up to 2 gigawatts of AMD's MI450 AI accelerators beginning in the first half of 2027.
The deployment will utilize AMD's next-generation Helios rack-scale platform, combining MI455X GPUs, EPYC Venice CPUs, Pensando networking technology, and ROCm software to power future generations of Claude AI models. The partnership goes beyond supplying AI chips. AMD also plans to invest up to $5 billion in Anthropic, deepening the relationship as both companies work to expand AI infrastructure.
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CEO Lisa Su said the collaboration combines Anthropic's frontier AI expertise with AMD's high-performance computing platform, helping accelerate AI adoption at scale while positioning Helios as a leading platform for next-generation AI workloads. The deal could also have a meaningful financial impact. KeyBanc analyst John Vinh estimates that the full 2-gigawatt deployment could generate roughly $27.2 billion in revenue for AMD, while reinforcing the company's standing as a credible alternative to Nvidia Corporation (NVDA) in the AI accelerator market.
With AI infrastructure spending expected to climb sharply over the coming years, the partnership further strengthens AMD's long-term growth story. Against this backdrop, here's a closer look at AMD stock.
About AMD Stock
Based in California, Advanced Micro Devices has grown into one of the world's leading semiconductor innovators, developing GPUs, CPUs, and high-performance computing solutions that power some of today's fastest-growing markets, including gaming, data centers, and artificial intelligence. Its technology touches billions of lives every day, supporting everything from Fortune 500 enterprises to cutting-edge scientific research that is reshaping how the world works, plays, and innovates.
AMD's AI ambitions are becoming increasingly difficult to ignore. A growing number of enterprises are adopting the company's Instinct MI300-series accelerators for data center and AI training workloads, positioning AMD as one of the strongest challengers to Nvidia's dominance in the AI chip market.
At the same time, the company is gaining momentum in the emerging AI PC market with its Ryzen AI Max and Strix Halo processors, which combine powerful Zen CPU cores, integrated RDNA graphics, and dedicated NPUs to bring advanced AI capabilities directly to users' devices. That momentum has been reinforced by a series of major wins. Strong earnings, expanding partnerships with technology giants, and continued market-share gains against rivals such as Intel (INTC) and Nvidia have helped cement AMD's reputation as one of the market's premier AI investments.
Investor enthusiasm accelerated further following the company's Advancing AI 2026 event on July 23, where AMD unveiled a sweeping expansion of its AI infrastructure strategy. The Advancing AI 2026 event offered investors far more than just the launch of Helios, AMD's next-generation rack-scale AI system built to compete directly with Nvidia's high-end AI platforms. According to the company, Helios delivers up to 30% more inference tokens per dollar than competing solutions, helping customers maximize AI performance from every rack deployed.
Beyond unveiling its multi-billion-dollar partnership with Anthropic, AMD also laid out an ambitious AI roadmap through 2030, announced a strategic partnership with Cerebras (CBRS), and expanded collaborations with industry leaders including OpenAI, Microsoft (MSFT), Meta Platforms (META), and Oracle (ORCL). Capping off the event, CEO Lisa Su projected that the total computing market could grow into a $2 trillion opportunity by 2030, reinforcing AMD's confidence in the long-term AI investment cycle. Investors have clearly taken notice.
Currently valued at a market capitalization of $880.02 billion, AMD shares are once again flirting with record territory, trading 10.7% below their all-time high of $584.73 reached in June, as confidence in the company's AI strategy continues to build. The stock has soared 220.9% during the past year and climbed another 142.9% year-to-date (YTD), dramatically outperforming the broader market. By comparison, the S&P 500 Index ($SPX) gained 16.3% over the past year and 8.1% YTD, highlighting just how enthusiastically investors have embraced AMD's AI-driven growth story.
www.barchart.com AMD’s Q1 Earnings Snapshot
AMD gave investors another compelling reason to stay optimistic when it reported blockbuster fiscal 2026 first-quarter results on May 5. The chipmaker comfortably exceeded Wall Street's expectations on both revenue and earnings, sending the stock soaring 18.6% in the following trading session. Revenue jumped 38% year-over-year (YOY) to $10.25 billion, easily surpassing analysts' expectations of $9.85 billion and rising sharply from $7.44 billion in the same quarter a year ago.
The strong top-line performance was matched by equally impressive profit growth. Non-GAAP earnings per share climbed 43% to $1.37, ahead of the consensus estimate of $1.30, while GAAP net income nearly doubled to $1.38 billion. The results underscored AMD's growing ability to convert surging demand into stronger profitability as its AI-focused business continues to scale.
Once again, the Data Center segment was the company's standout performer and remained AMD's primary growth engine. Revenue from the division surged 57% YOY to $5.78 billion, driven by robust demand for EPYC server processors and rising shipments of Instinct AI accelerators. However, AMD's strength extended well beyond data centers. Its Client and Gaming businesses also delivered healthy growth, generating a combined $3.61 billion in revenue, up 23% from the prior-year quarter.
The Client segment contributed $2.9 billion in revenue, representing 26% annual growth, fueled by strong demand for Ryzen processors and continued market-share gains. Meanwhile, Gaming revenue increased 11% to $720 million, as healthy demand for Radeon GPUs more than offset weakness in semi-custom products. Profitability also continued to improve, with non-GAAP gross margin expanding to 55% from 54% a year earlier, reflecting the increasing contribution of AMD's higher-margin AI and data center products.
Management attributed the strong performance to accelerating demand for AI infrastructure. The rapid adoption of AI inferencing and agentic AI workloads is driving greater demand for high-performance CPUs and AI accelerators, while customer interest in AMD's next-generation MI450 Series and Helios platforms continues to build. Adding to the positive outlook, the company noted that demand forecasts from several major customers are already exceeding its initial expectations, providing greater confidence in its long-term growth trajectory.
Looking ahead, AMD expects the momentum to continue. For the second quarter of fiscal 2026, management guided for revenue of approximately $11.2 billion, plus or minus $300 million. At the midpoint, that represents roughly 46% YOY growth and about 9% sequential growth. AMD also expects non-GAAP gross margin to improve further to approximately 56%, signaling management's confidence that demand for its AI and data center portfolio remains exceptionally strong.
What Do Analysts Think About AMD Stock?
Wall Street remains firmly in AMD's corner. The stock currently carries a consensus "Strong Buy" rating, reflecting analysts' confidence in the company's AI-driven growth trajectory. Of the 45 analysts covering AMD, 35 rate it a "Strong Buy," two recommend "Moderate Buy," while eight maintain "Hold" ratings.
Despite AMD's remarkable rally, many analysts still see room for further gains. The average price target of $548.71 implies 5.4% upside from current levels, while the Street-high target of $755 points to a potential 45.1% gain, suggesting that some on Wall Street believe AMD's AI growth story still has plenty of runway.
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www.barchart.com On the date of publication, Anushka Mukherji did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
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