AMD Challenges Nvidia with Next Generation of AI Infrastructure at Major San Francisco Event

AMD expected to launch next generation of AI infrastructure to challenge Nvidia

SAN FRANCISCO, July 23 (Reuters) - Advanced Micro Devices (AMD.O), opens new tab is set to launch a raft of AI hardware that will rival Nvidia (NVDA.O), opens new tab on Thursday at an event at a downtown convention center in San Francisco. AMD is attempting to capture market share from Nvidia in the fast-growing data center chip sector, especially for so-called inference computing, which is the data crunching that occurs when a user queries a chatbot such as OpenAI's ChatGPT. AMD is expected to show off the company's data center hardware that includes its first-generation ⁠server racks called Helios, which it is marketing as a rival to a similar design from Nvidia, which is rolling out its second-generation product this year. The company also is expected to formally launch its Venice central processing unit (CPU) for data centers. This week, Nvidia released a spate of technical details about its Vera CPU, which aimed to show that the chip, when combined with Nvidia's "Rubin" graphics processing unit (GPU), will do the best job at maximizing how much work AI agents can do with a given amount of ⁠electricity. At the Moscone West convention center on Wednesday, hundreds of executives and engineers gathered to take in technical presentations and mingle on a showroom floor, according to a Reuters witness. AMD displayed the Helios data center rack amid booths from cloud computing providers such as Vultr and TensorWave. Both ⁠cloud providers operate data centers with AMD hardware. On Wednesday, AMD announced plans to sell up to two gigawatts of its Instinct MI450 chips to AI lab Anthropic beginning in the first half of ⁠2027. The deal also includes an investment of as much as $5 billion in the Claude maker. In October, AMD announced a multiyear deal with OpenAI that would also ⁠bring in tens of billions of dollars in annual revenue while giving the ChatGPT creator the option to buy up to roughly 10% of the chipmaker. Reporting by Max A. Cherney and Stephen Nellis in San Francisco; Editing by Matthew Lewis Our Standards: The Thomson Reuters Trust Principles., opens new tab * Suggested Topics: * Business Max A. Cherney Thomson Reuters Max A. Cherney is a correspondent for Reuters based in San Francisco, where he reports on the semiconductor industry and artificial intelligence. He joined Reuters in 2023 and has previously worked for Barron's magazine and its sister publication, MarketWatch. Cherney graduated from Trent University with a degree in history.

AMD Gains a Major Customer for Its Latest Tech Ahead of Its 'Advancing AI' Event -- Here's What You Need to Know

Get personalized, AI-powered answers built on 27+ years of trusted expertise. A major new customer for Advanced Micro Devices' latest tech has the chipmaker's stock rising to start what could be a pivotal week for the Nvidia rival. Shares of AMD (AMD) were up more than 3% around $513 in recent trading after the company said it's added Microsoft as a customer for its Helios rack-scale system, which could bring the chipmaker in closer competition with leader Nvidia (NVDA). Other semiconductor stocks also gained, after losing ground late last week. The announcement comes just ahead of AMD's two-day "Advancing AI" event starting Wednesday, where it's expected to showcase its latest AI products and partnerships. CEO Lisa Su is set to headline a keynote address scheduled for 12:30 p.m. ET Thursday. (You can watch it here.) Analysts at Bank of America said in a note Friday that AMD could also offer "greater visibility into 2027 deployments, production ramps, and broader hyperscale adoption" at the event, with a more ambitious update to its longer-term outlook based on growing AI demand. Jefferies analysts, who told clients last week that they anticipated Microsoft would be a likely new customer for AMD's latest chips, along with Anthropic, said such deals would represent a "major positive for the stock and reinforce confidence in AMD's ability to compete at the highest level without incentives." Wall Street analysts are widely bullish on AMD. Jefferies, along with six of the eight other analysts with current ratings surveyed by Visible Alpha, have issued "buy" or equivalent recommendations, compared to two neutral ratings. Their mean target around $545 would suggest they still see about 6% upside for the stock after a strong run this year, despite a recent pullback for the AI trade. With Monday's gains, AMD stock has risen roughly 140% this year, making it one of the best-performing S&P 500 stocks of 2026 so far. It's more than tripled over the past 12 months.

Should Investors Buy AMD Instead Of Nvidia? - NVIDIA (NASDAQ:NVDA), Advanced Micro Devices (NASDAQ:AMD)

Nvidia has been the clear leader for years, but AMD is starting to close the gap. The company has landed major customers, introduced new AI hardware, and continues to grow its server business at an impressive pace. So, after AMD's rally this year, should investors buy AMD instead of Nvidia? Or does Nvidia still offer the stronger long-term opportunity? Let's break it down. Nvidia Still Sets the Standard in AI Nvidia remains the biggest name in AI chips, and its financial results show why. In the first quarter of fiscal 2027, the company reported $81.6 billion in revenue, an 85% increase from a year ago. Even more impressive, its Data Center business generated $75.2 billion, up 92% year over year, while adjusted earnings climbed 140% to $1.87 per share. These numbers show that demand for Nvidia's AI products is strong. The company continues to benefit from rapid adoption of its Blackwell AI platform, solid networking demand, and investments from cloud providers, enterprises, and governments building AI infrastructure. Nvidia is also much more than a GPU company today. Its CUDA software platform remains the industry's favorite AI ecosystem, making it difficult for customers to move to another supplier. The company is also expanding into CPUs with its new Vera architecture, creating another long-term growth opportunity. According to Bank of America, the global server CPU market could reach $170 billion by 2030, four times its current size. Nvidia wants Vera to become an important part of that future. Financially, Nvidia remains in an excellent position. During the quarter, it generated $50.3 billion in operating cash flow and $48.6 billion in free cash flow. It also returned $19.3 billion to shareholders through stock buybacks while paying another $243 million in dividends. However, Nvidia isn't without challenges. Export restrictions to China remain a concern. Investors are also watching reports about possible delays in its Vera Rubin platform, increasing competition from rivals, and whether large technology companies will continue spending aggressively on AI infrastructure. AMD Is Becoming a Serious AI Challenger While Nvidia remains the market leader, AMD is building momentum. The company reported first-quarter 2026 revenue of $10.3 billion, up 38% from last year. Its Data Center business reached a record $5.8 billion, increasing by 57%, while adjusted earnings increased 43% to $1.37 per share. Much of that growth came from the high demand for AMD's EPYC server processors and Instinct AI GPUs. Also, AMD's list of customers choosing its AI technology is growing Microsoft announced that it will deploy AMD's new Helios AI rack systems on Azure to power advanced AI models. The expanded partnership also includes new Azure virtual machines powered by AMD's EPYC processors and additional networking technology across Microsoft's cloud platform. The firm joins an impressive customer list that already includes Meta, OpenAI, Oracle, and other AI companies. AMD also expects shipments of its Helios systems, including deliveries to Microsoft, to begin during the second half of 2026. CEO Lisa Su called Microsoft's deployment "an important milestone" as AMD continues scaling its next-generation AI infrastructure. AI Customer List Keeps Growing Microsoft isn't the only company betting on AMD. WSJ revealed that AMD has signed a multi-billion-dollar agreement with Anthropic to deploy its new MI455X GPUs and Helios rack-scale systems. Following the announcement, Wells Fargo raised its price target on AMD to $615 while keeping an Overweight rating. The bank said AMD's data center GPU revenue could reach $40.6 billion by 2027, with some investors expecting it could even exceed $50 billion. AMD has also secured major long-term commitments from Meta and OpenAI, which have both agreed to deploy up to 6 gigawatts of AMD AI infrastructure over time. Oracle is building a 50,000-GPU Helios supercluster, while Microsoft has become the first publicly announced customer for AMD's Helios platform. These wins suggest that AMD is no longer competing for small AI projects. It is now winning contracts from some of the biggest AI companies in the world. AMD and Nvidia Are Taking Different Approaches Nvidia and AMD are trying to solve AI computing in different ways. According to BofA, Nvidia said AI performance should be measured by how quickly each AI agent completes its task. That thinking is behind its new Vera CPU, which combines custom ARM-based processors with Rubin GPUs, networking, and storage into one tightly connected AI platform. AMD sees things differently. The company shared that the future is about running more AI agents on each server at the same time. Its EPYC processors are designed to maximize throughput, allowing businesses to process more AI workloads across each rack. Bank of America noted that AMD estimates its EPYC Turin processors deliver about 2.4 times Nvidia's rack-level throughput in certain workloads, while the next-generation EPYC Venice chips could increase that advantage to 3.3 times. Hidden Strength May Be Its CPU Business Many investors focus only on AMD's AI GPUs, but some analysts believe the company's biggest opportunity could actually be its server CPUs. AMD has steadily taken market share from Intel in recent years. During the latest quarter, its Data Center business generated $5.8 billion, surpassing Intel's data center revenue. The company doubled its estimate for the server CPU market, saying it could exceed $120 billion by 2030 as AI creates more demand for CPUs alongside GPUs. Some analysts believe this part of AMD's business is still undervalued because most investors remain focused on AI accelerators. AMD is also generating better cash flows as the business grows. During the first quarter, it produced $3 billion in operating cash flow and $2.6 billion in free cash flow, while maintaining a healthy balance sheet with more cash than debt. Which Stock Looks Better Today? There is no doubt that AMD has become one of the biggest success stories in AI. Its partnerships with Microsoft, Anthropic, Meta, OpenAI, and Oracle show that more companies want alternatives to Nvidia. AMD is expanding its AI ecosystem, its CPU business, and proving it can compete for some of the world's largest AI contracts. However, Nvidia still leads in important areas. The company generates far more revenue, enjoys much higher profit margins, produces significantly more free cash flow, and continues to benefit from its powerful CUDA software ecosystem. Its complete AI platform, which includes GPUs, CPUs, networking, and software, also gives customers a reason to stay within Nvidia's ecosystem. Meanwhile, AMD's 52-week high is about $584, gaining more than 150% this year, while Nvidia's high is $212, rising only 11% in the year. The new rally pushed AMD's forward price-to-earnings ratio above 70, compared with 23 for Nvidia. Although AMD continues to grow rapidly, investors are already paying a premium for that future growth. Nvidia, meanwhile, is delivering faster revenue growth and stronger profitability. AMD looks like the strongest challenger Nvidia has faced in years, and its list of AI customers suggests it could continue gaining market share. Benzinga Disclaimer: This article is from an unpaid external contributor. It does not represent Benzinga's reporting and has not been edited for content or accuracy. Market News and Data brought to you by Benzinga APIs To add Benzinga News as your preferred source on Google, click here.

Nvidia vs. AMD: The Next AI Battle Targets a $170 Billion Prize - Advanced Micro Devices (NASDAQ:AMD), NV

For nearly three years, investors judged the AI race by one metric: GPU performance. Bank of America thinks the next winner may depend on something far less discussed: server CPUs. The question isn't which company builds the faster processor. It's which metric customers decide matters most. One Company Wants Faster AI, The Other Wants More AI Bank of America says Nvidia measures success by how quickly a single AI agent completes its work. "Nvidia introduced a new framework: max single-threaded performance at scale," analyst Vivek Arya said. The approach focuses on latency. AI agents execute tasks one step at a time, with CPUs feeding data to GPUs throughout the process. Faster CPU cores shorten each cycle and keep expensive GPUs busy. AMD sees the problem differently. The company argues future AI systems will run thousands of agents simultaneously across large data centers. That shifts the focus from speed to throughput. "Production AI resembles a distributed software platform," Arya said. That architecture favors CPUs that handle more concurrent workloads rather than completing one task faster. According to Bank of America, AMD estimates its upcoming EPYC Venice platform could deliver about 3.3 times the rack-level throughput of Nvidia's Vera reference system under its modeling assumptions. The Metric Could Decide Where Billions Flow For investors, the biggest takeaway isn't today's benchmark. It's that hyperscalers may soon adopt a new way to measure AI infrastructure. "The key question is time-to-complete an agent or number-of-agents-per-rack," Arya said. If cloud providers prioritize latency, Nvidia's strategy gains support. If they prioritize concurrency and utilization, AMD could strengthen its position. Bank of America expects AMD's AI event to focus on that distinction rather than traditional benchmark comparisons. The Debate Goes Beyond Nvidia And AMD The discussion also extends to processor architecture. Nvidia's Vera uses Arm-based designs, reinforcing the industry's shift toward custom Arm CPUs. AMD and Intel continue to back x86, arguing enterprise software, databases and middleware remain heavily optimized for that ecosystem. The outcome may influence far more than CPU market share. If AI infrastructure spending increasingly depends on CPU architecture and workload optimization, investors may need to look beyond GPUs to identify the next winners in AI hardware. What Are Analysts Saying Now? According to Benzinga Analyst Ratings, Nvidia holds a Buy consensus with an average price target of $309.75, implying roughly 50% upside from Wednesday's $207.16, with individual targets running from a low of $215 to a Street-high $500. The recent flow has leaned higher. Bank of America sits inside that consensus. In the note, Arya reiterated a Buy and a $350 price objective -- roughly 69% above the $207.29 level cited in the report -- arguing Nvidia's lead in AI compute and networking still justifies a premium even as the CPU front opens. The GPU made Nvidia the most valuable company on earth. The CPU is where it now has to prove the story isn't over. Market News and Data brought to you by Benzinga APIs To add Benzinga News as your preferred source on Google, click here.

AMD's $600 Target Isn't Really About AMD - Advanced Micro Devices (NASDAQ:AMD)

In fact, the firm believes the biggest AI demand catalyst is still at least a quarter away. Yet it raised AMD's price target to $600 from $460, arguing the market is becoming willing to pay more for companies positioned to benefit from the next phase of the AI infrastructure buildout. Patience Before The Next AI Wave BNP Paribas opened its second-quarter semiconductor earnings preview with an unusual observation: a recent sell-off across AI names has actually reduced the risk of a broader "sell-the-news" reaction this earnings season. In other words, Wall Street may need to be patient before the next major AI spending wave begins. Why AMD's Target Went Higher That makes BNP Paribas' decision to raise AMD's price target even more notable. The brokerage didn't point to an imminent earnings inflection. Instead, it cited higher valuation multiples, suggesting investors are placing a greater premium on companies expected to benefit from the next leg of AI infrastructure spending. The distinction matters. Raising earnings estimates implies expectations for stronger near-term financial performance. Raising the multiple investors are willing to pay reflects growing confidence in the durability of a company's long-term growth story. For BNP Paribas, AMD appears to be benefiting from the latter. The AI Market Is Already Looking Ahead The firm remains bullish on the semiconductor sector through 2027, even as it expects a relatively quiet earnings season. Rather than chasing the first wave of AI spending centered on GPUs, BNP Paribas believes the next phase will broaden across custom processors, Agentic AI CPUs, networking switch ASICs, high-speed optical transceivers and memory. For investors, AMD's new $600 price target may ultimately be less about what the company reports over the next few weeks and more about how Wall Street is beginning to value the next chapter of the AI investment cycle. Image via Shutterstock Market News and Data brought to you by Benzinga APIs To add Benzinga News as your preferred source on Google, click here.

AMD: UBS hikes price target ahead of AI event on stronger GPU outlook By Investing.com

Investing.com-- Advanced Micro Devices (AMD) (NASDAQ:AMD) received a higher price target from UBS ahead of its "Advancing AI" event next week, with the brokerage citing growing confidence in the chipmaker's AI roadmap, expanding customer base and stronger long-term GPU revenue potential. UBS raised its 12-month price target on AMD to $700 from $670 while maintaining its "Buy" rating, saying recent supply chain checks point to significantly higher AI accelerator demand through 2027. Access premium analyst insights with InvestingPro subscription -- get 60% off now The brokerage expects the event to focus primarily on AMD's technology roadmap rather than major financial updates. Analysts anticipate new details on the MI450X accelerator launching later this year, the MI500 GPU family due in 2027, and progress on the Venice and Verano server CPU platforms. UBS also said AMD could provide updates on its embedded and gaming businesses, announce additional AI customers, or unveil deeper partnerships in custom AI chips. UBS said its supply chain research suggests AMD could generate $40 billion to $50 billion in GPU revenue in 2027 if it secures three hyperscale AI customers with deployments exceeding one gigawatt each. The brokerage believes Amazon will be a major customer for the MI450X platform and said Anthropic could also adopt the chips, although it cautioned investors against expecting customer announcements at the event. Reflecting stronger AI infrastructure demand, UBS raised its 2027 revenue forecast to $83.4 billion from $79.2 billion and increased its 2027 earnings per share estimate to $14.63 from $13.47. It also lifted its 2028 EPS forecast to $21.11 from $18.85, underpinning the higher price target.