Buy AMD at raised target of $465 based on strong data-center CPU growth, GPU leadership with Venice platform, and new Anthropic partnership securing MI455 demand through 2027-2028.
AMD's data-center CPU business to grow 55%/48% YoY in 2026E/2027E driven by price increases, Venice ramp, and market share gains. Secured 160k-180k wafers CoWoS capacity for 2027. New Anthropic partnership signals strong demand. MI455 supply improvements and multiple GW-scale customers indicate strong demand continuing into 2027-2028.
GF Overseas Electronics & Communications — AMD (AMD US, Buy): Key Focus Areas and Catalysts Ahead of Earnings Call Buy rating, target price raised to US$465: Following the recent share-price rally and Intel’s better-than-expected results, market expectations have already moved higher. However, we remain optimistic and outline the key issues to watch during and after the earnings call. Incorporating our updated pre-earnings preview and higher CPU/GPU shipment assumptions, we raise our 2026E/2027E EPS forecasts by 2%/6%, respectively. We lift our target price from US$311 to US$465, based on 38x 2027E P/E. Strong CPU business and capacity: We expect AMD’s data-center CPU business to grow 55%/48% YoY in 2026E/2027E, driven by: 1. CPU price increases in April / 4Q26; 2. ramp-up of the Venice platform in 3Q26; 3. market-share gains from product leadership and customer expansion. In the near term, driven by cloud demand, we expect ODM server shipments to grow around 10% QoQ in 2Q. On the demand side, agentic AI is expected to drive the CPU-to-GPU ratio back toward a more balanced level, while AMD’s competitive advantage continues to expand with its N2-based Venice platform. Based on our ASE report published on April 29, we believe AMD has secured 160k–180k wafers of CoWoS capacity for 2027. New partnership with Anthropic: According to Wccftech’s April 17 report, supply constraints prompted Anthropic to sign an agreement with AMD to use MI450 chips. This could become a key focus of the upcoming earnings call. Unlike AMD’s five-year, 6GW partnerships with Meta/OpenAI in exchange for AMD warrants, we expect this collaboration to be more flexible in both GW scale and transaction structure. However, given Anthropic’s rapidly growing ARR, the first-year scale of the partnership could be larger. MI455 progress: Following our April 14 report, Demand Far Exceeds Supply, in which we noted a downward revision to MI455 shipments due to the complexity of its stacked design, we believe the supply chain is still maintaining its target of starting shipments in mid-3Q. Meanwhile, downstream readiness has improved with support from Wistron and Foxconn Industrial Internet. With multiple GW-scale customers including OpenAI, Meta, and Anthropic, we expect strong MI455 demand to continue into 2027/2028. MI550 versus Rubin Ultra: As stated in our March 31 report, we believe Rubin Ultra has been changed to a dual-chip design, with a second MCM version used to connect two sets of dual chips, while 16-high HBM4e may be revised down to 12-high due to capacity constraints. For AMD, given its experience in 2.5D/3D packaging, we believe MI550 remains on track, using a four-chiplet / 8-XCD package with 12-high HBM4e. Combined with the 2nm process node, MI550, as a single GPU, could deliver superior performance. $AMD
| Horizon | Raw move | vs SPY |
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| 1 day | +18.6% | +17.2% |
| 1 week | +26.2% | +24.2% |
| 1 month | +47.3% | +42.7% |
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| 6 months | — | — |