Bernstein Raises AMD Price Target to $650
Bernstein analyst Stacy Rasgon raised the price target on AMD (NASDAQ: AMD) to $650 (from $600) while maintaining an Outperform rating.
“Q3 revenue outlook was good ($13.0B/~$1.93 vs Street $12.5B/$1.87), with gross margin of 56% inline to a touch below consensus (56.2%) though with opex once again meaningfully above ($3,650M vs Street at $3,535M).
The beat appears driven by Data Center and Embedded revenues, which are both seen up strong double-digits sequentially. Data Center revenues are likely ~$8.1B vs.
Street at ~$7.7B, with double-digit sequential growth across server CPUs (guided up >80% YoY in 2H26) and AI GPUs we believe are implicitly guided to ~$3.4B or so, mostly inline with Street at ~$3.36B.
And yet the stock sold off in the aftermarket; we suspect expectations had moved higher following Intel’s results a couple of weeks ago, and the buyside already has a fairly bullish outlook.
Nevertheless, the fundamentals and story here are getting better.
Server outlook continues to surprise to the upside, and the company is still taking share and benefitting from pricing; in fact they now feel comfortable signing up for 70%+ server growth next year and total datacenter growth of “well over” 100% (a wide range for now admittedly but one that admits the possibility of some large numbers as the Helios ramp begins).
Embedded is finally entering recovery. And even client is holding up better than expected.”
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