March 23, 2025 – New York, NY – At its GTC 2025 event, Nvidia CEO Jensen Huang projected that data center buildouts will hit $1 trillion by 2028, accelerating from his previous forecast of 2030. This bullish outlook has reignited interest in Nvidia (NVDA) stock, but it also casts a spotlight on its rising competitor, Advanced Micro Devices (AMD), which is rapidly gaining ground in the AI and data center markets.
🔍 AMD’s Rising Data Center Dominance
While Nvidia remains the undisputed leader in the GPU market, AMD is emerging as a formidable challenger. The company’s Q4 2024 results highlighted its growing strength:
- Record quarterly revenue of $7.7 billion, up 24% year-over-year.
- Data center revenue surged 69% to $3.9 billion, making up 51% of total revenue.
- Gross margins expanded to 54%, compared to 51% a year earlier.
- Net cash from operations soared 3.5x to $1.3 billion, with $3.8 billion in cash and no short-term debt.
Looking ahead, AMD projects Q1 2025 revenue between $6.8 billion and $7.4 billion, representing an anticipated 30% yearly growth at the midpoint.
🔥 Competitive Edge with Next-Gen AI Chips
AMD is accelerating its AI chip innovation, aiming to rival Nvidia’s dominance:
- MI350 series GPUs, based on the CDNA 4 architecture, are set to launch mid-2025, offering a 35x leap in AI compute power over the previous generation.
- Built on a 3-nanometer process node, AMD’s MI350 will outpace Nvidia’s Blackwell architecture, which uses 4-nm technology, providing greater efficiency and performance.
- MI350 GPUs will feature 288GB of HBM3E memory from Micron (MU), surpassing Blackwell’s 192GB configuration, potentially giving AMD an edge in AI workloads.
- AMD’s MI300 GPUs are gaining real-world traction, with Meta Platforms (META) selecting them to power its Llama large language model, a major win for AMD in the high-performance AI market.
💡 Real-World Adoption and Supercomputing Leadership
AMD’s influence extends beyond AI accelerators. Its processors now power five of the 10 fastest supercomputers globally, including El Capitan, the world’s most powerful supercomputer, which delivers an unprecedented 1.742 exaflops of computing power for scientific and defense applications.
📈 Analyst Ratings and Market Potential
Despite being down 12.7% year-to-date, AMD’s market share in GPUs has risen from 10% to 17%, highlighting its growing foothold. Analysts have a “Moderate Buy” rating on AMD stock, with a mean target price of $147.10, suggesting an upside potential of 40% from current levels. Of the 42 analysts covering the stock:
- 28 rate it as a “Strong Buy”.
- 1 has a “Moderate Buy” rating.
- 13 recommend a “Hold”.
🔗 What’s Next?
As data center buildouts ramp up toward $1 trillion by 2028, AMD’s rising market share, cutting-edge AI chips, and expanding partnerships position it as a top contender alongside Nvidia. With its strong fundamentals and accelerating innovation, AMD presents a compelling growth opportunity for AI-focused investors.
Stay tuned for more updates on AMD, Nvidia, and the evolving AI landscape.
